ICE cotton prices slide to two-week low as strong dollar and US tariffs impact market

ICE cotton futures fell to their lowest level in two weeks, pressured by a strong US dollar, newly implemented tariffs on Indian textiles, and weakness across the broader commodity markets. The benchmark December 2025 cotton contract slipped by 0.03 cent to settle at 66.68 cents per pound, the lowest since August 11. Over the past three sessions, prices have collectively lost 133 points, with several contracts declining by between 2 and 10 cents, signaling broad-based selling pressure. Market analysts noted that the US dollar’s recent strength has made cotton more expensive for overseas buyers, leading to reduced international demand. Adding to the bearish sentiment, Washington’s 25 percent tariff on Indian garments and textiles, which came into effect on August 27, is expected to restrict India’s exports to the US. This move could weigh on global consumption trends, especially for raw cotton, as demand from key downstream markets slows. The cotton market also mirrored weakness in the grains sector, where softer prices reinforced the overall negative sentiment for agricultural commodities. Despite the decline in futures prices, deliverable stocks for the ICE No. 2 cotton contract remained unchanged at 15,474 bales as of August 26, indicating stability in physical availability. Traders are now closely watching the upcoming US Department of Agriculture’s weekly export sales report, which could provide clearer insights into near-term demand and potential export trends. With the dual pressure of currency fluctuations and trade policy shifts, cotton traders remain cautious. While some expect possible stabilization if export demand improves, the market outlook continues to hinge heavily on the dollar’s strength and the impact of the new US tariff regime on global textile trade.

9,850SubscribersSubscribe

[