Cotton Futures Decline as Market Responds to Tariff Changes
Cotton futures experienced notable losses on Friday, with nearby contracts down between 115 to 144 points. The May contract alone fell by 354 points this week. Additionally, crude oil futures dropped by $4.63 per barrel, while the US dollar index rose by $0.821 for the day.
China’s swift response to President Trump’s reciprocal tariffs included a retaliatory tariff of 34% on all US goods, sharply impacting the market. Conversely, Vietnam has proposed reducing tariffs to 0%, providing a slight lift to the cotton market from its session lows.
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According to Friday’s CFTC Commitment of Traders report, managed money reduced their net short positions in cotton futures and options by 7,176 contracts as of April 1, leading to a net short of 66,634 contracts by Tuesday.
Export Sales data showed total cotton commitments at 10.438 million running bales (RB), reflecting a 4% decrease from the previous year. This figure represents 101% of the USDA report, with the average pace aligning at 102%.
The Cotlook A Index retreated by 50 points on April 3, landing at 79.60 cents per pound. ICE cotton stocks remained unchanged on April 2, with current certified stocks reported at 14,488 bales. The USDA’s Adjusted World Price (AWP) rose by 158 points on Thursday afternoon, reaching 55.22 cents per pound.
May 25 Cotton: Closed at 63.36, down 144 points.
Jul 25 Cotton: Closed at 64.56, down 115 points.
Dec 25 Cotton: Closed at 66.16, down 139 points.
On the date of publication, Austin Schroeder did not hold any positions, directly or indirectly, in any of the securities mentioned in this article. All information and data provided are for informational purposes only. For further details, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
