Cotton Gives Up Gains to Finish Lower

After flirting with a classic counter-Tuesday session earlier, the cotton market found a way to regroup and trade positively. Likely, falling crude oil and strong Chicago grains helped, but the veracity of Texas crop remains a question. Also, the internal auctions of China’s state reserves have been proceeding well. Yet, late in the day, that old bullish-Monday bearish-Tuesday curse emerged, toppling the market and bringing it lower.

Today, the Federal Reserve is meeting to discuss U.S. interest rates, under its new chairman. That decision will be publicly conveyed at 2 p.m. EDT Wednesday. Currently, there is a 66% chance that the central bank will not do anything. However, some governors would like to hike rates immediately.

Crude oil continues to fall as the U.S.-Iran hostilities remain paused. Yet, there are ongoing talks between Iran and Oman with Saudi Arabia concerning the Strait of Hormuz. Supposedly, President Trump’s massive attack on Iran remains on the table.

This Thursday at 8:30 a.m. EDT, USDA will issue its weekly export sales report. Highlights from the previous report included sales of 51,287 bales for the 2025/26 marketing year and 16,146 bales for the 2026/2027 season. The combined seasonal summary was 67,433 bales. Although that amount exceeded 38,435 bales from the previous week. Cumulative sales for 2025/26 have reached 107% of USDA’s forecast versus a five-year average of 114% for this point in the marketing year. Shipments totaled 276,313 bales, up from 214,893 bales the previous week.

On Friday, the CFTC updated its Commitment of Traders data. The results showed that the managed-money funds bought some 3,500 futures, further swelling their net-long position to 53,209 contracts.

For Tuesday, December closed at 80.53 cents, down 35 points; March 2027 finished at 82.11 cents, minus 36 points; and July 2027 settled at 83.16 cents, off 45 points. Tuesday’s estimated volume was 34,333 contracts.

Keith Brown can be reached at commodityconsults@gmail.com