Yesterday, the ICE cotton May 2025 contract settled at 63.36 cents per pound (0.453 kg), down 1.44 cents from Friday. During the session, the contract hit a low of 60.80 cents per pound—the lowest level since August 2020.
ICE cotton futures fell to a four-year low after China announced a 34 per cent tariff on US imports, threatening demand from its largest buyer, which accounts for 25 per cent of US cotton exports.
A stronger US dollar and falling crude oil prices added pressure.
Market analysts cite worsening trade tensions and improved US crop outlook as key bearish factors.
Other commodity markets also declined.
The US dollar index rose by 0.5 per cent, making dollar-denominated cotton more expensive for international buyers and further weakening export competitiveness. Crude oil prices fell by 8 per cent, nearing their lowest close since mid-2021. This has put downward pressure on polyester prices—a direct competitor of cotton in textile manufacturing.
ICE Certified Stocks as of April 3, 2025, remained unchanged at 14,488 bales, indicating no drawdown in deliverable supply despite the falling prices. The Intercontinental Exchange (ICE) announced that starting Monday, April 7, daily price limits for all No. 2 cotton futures contracts will be set at 3 cents per pound above or below the previous day’s settlement.
The primary reason for the decline was China’s announcement of a 34 per cent tariff on all US imports, effective from April 10, 2025, which is expected to severely impact demand for US cotton.
Market analysts described the bearish news as overwhelming. Trump’s tariffs have significantly harmed the market. Meanwhile, rain in West Texas has improved the outlook for US cotton production.
China accounts for approximately 25 per cent of US cotton exports, making it the largest buyer of American cotton. The market now anticipates a potential halt in Chinese demand for US cotton.
Other commodity markets were also under pressure. Chicago soybean futures fell by more than 2 per cent, wheat futures were down over 2 per cent, and corn futures declined by more than 1 per cent.
ICE cotton for May 2025 settled at 63.36 cents per pound (down 1.44 cents). Cash cotton settled at 61.11 cents (down 1.11 cents), the July 2025 contract at 64.56 cents (down 1.15 cents), the October 2025 contract at 66.41 cents (down 1.20 cents), the December 2025 contract at 66.16 cents (down 1.39 cents), and the March 2026 contract at 67.39 cents per pound (down 1.35 cents).
Fibre2Fashion News Desk (KUL)
