Jim Wyckoff
5 min read
July ICE cotton futures (CTN25) were under modest selling pressure on Wednesday and slipped to a nine-week low below 65 cents a pound. The overall technical posture for the cotton futures market favors the bears as prices are in a seven-week downtrend on the daily bar chart. However, there are also some early, bullish clues that the cotton market has forged a price bottom.
Since scoring a contract low of 62.05 cents a pound on April 4, July cotton futures have chopped in a sideways trading range. This is likely “basing” action on the daily chart that has put in a price bottom.
With a price bottom likely in place, the cotton bulls now need some bullish fundamental news to start a price uptrend.
Last week’s monthly USDA supply and demand report had some price-friendly elements for the cotton market. The 2025/26 marketing year U.S. cotton balance sheet was revised to show lower production, beginning stocks, and ending stocks, with consumption, imports, and exports unchanged from last month.
U.S. harvested area was lowered 2% to 8.19 million acres following extensive rainfall and delayed planting in the Delta. The national average yield for 2025/26 was reduced more than 1% from last month’s report, to 820 pounds per harvested acre, also because of the conditions in the Delta.
As a result, U.S. cotton production was forecast down 500,000 bales, to 14.0 million, and is below the 14.4 million bales produced in 2024/25 and the second-smallest crop in the past decade.
Beginning U.S. stocks for the 2025/26 marketing year were reduced 400,000 bales following a corresponding increase in projected U.S. exports for 2024/25. As a result, 2025/26 ending stocks were lowered 900,000 bales to 4.3 million, for a stocks-to-use ratio of 30.3%.
The projected season-average price for 2025/26 was unchanged in the USDA June report, at 62 cents per pound.
For the 2025/26 marketing year, USDA forecast downwardly revised global cotton production, consumption, beginning and ending stocks, and world trade. World production was lowered over 800,000 bales as a 1-million-bale increase for China was more than offset by reductions for India, the United States, and Pakistan. Global consumption was reduced by over 300,000 bales for 2025/26.
