FX.co ★ Cotton Futures Ease

Cotton futures eased to around 86 cents per pound in mid-May, pulling back slightly from a more than two-year high as a stronger US dollar countered support from the latest WASDE report, which pointed to a tighter supply outlook. The USDA kept its 2025/26 cotton yield forecast unchanged at 852 lbs per acre and projected production at 13.9 million bales, while old-crop ending stocks were also left steady at 4.4 million bales. For 2026/27, production was revised lower to 13.3 million bales, with ending stocks expected to decline to 3.9 million bales, underscoring a tighter balance sheet ahead.

In the near term, planting progress reached 29% as of May 10, slightly above the five-year average of 28%, indicating broadly normal field conditions and curbing additional upside momentum. At the same time, traders are closely monitoring US weather, particularly in Texas—the key cotton-growing state—where persistently dry conditions could weigh on yields and reinforce expectations of a constrained supply.