Cotlook Index: 16-09-2026
94.60 (-0.05)
ICE cotton weakens further on demand and harvest pressure
Thursday, 17th Sep 2026, (Source: www.fibre2fashion.com)
Insights: ICE December 2026 cotton settles at 84.36 cents per pound, down 386 points over four sessions and 878 points from its August 31 high. Weak demand, advancing US harvest activity, a stronger dollar and softer crude oil keep prices under pressure. China's State Reserve auction sell-through eases to about 91.5 per cent, while weather risks and high open interest could raise volatility.
ICE cotton futures closed lower yesterday, extending their decline for a fourth consecutive session as weak demand, a stronger US dollar and advancing harvest pressure continued to weigh on the market. Weather-related crop concerns provided some support but were not enough to reverse the broader bearish trend. The most active December 2026 contract settled at 84.36 cents per pound, down 0.12 cent. The contract has now fallen by 386 points over the past four sessions. December cotton has closed lower in nine of the past 11 sessions and is down 878 points from its contract-high close of 93.14 cents recorded on August 31. Trading activity slowed considerably. Total volume stood at 40,922 contracts, the lowest in around three weeks, compared with 62,704 contracts in the previous session. The sharp drop in volume indicated reduced trading activity even as prices continued to weaken.Open interest (OI), however, remained close to record levels. OI increased by 448 contracts to around 380,206 contracts. Elevated OI despite the steep price correction suggests that a substantial number of positions remain active in the market. Friday's Commitment of Traders (COT) report may provide greater clarity on whether speculative funds have increased short positions or whether long positions are beginning to unwind. Demand remains one of the principal concerns for cotton. Mills generally become more cautious when futures prices rise sharply, particularly when physical cotton availability is expected to improve with the arrival of the new crop. The recent decline therefore reflects not only technical selling but also weaker buying interest at higher price levels. Seasonal harvest pressure is also becoming increasingly important. According to the USDA, around 8 per cent of the US cotton crop had been harvested as of September 13. As harvesting advances, additional new-crop cotton will enter the physical market, increasing availability for mills and merchants and reducing the urgency to purchase cotton at elevated futures prices.
The US dollar remained another negative factor. A stronger dollar makes US cotton more expensive for overseas buyers and can weaken the competitiveness of US-origin cotton in international markets. Currency movement therefore remains an important factor for export demand, particularly when global textile demand is already subdued.
Crude oil prices also weakened, removing some of the support cotton had recently received through the polyester-substitution channel. Lower crude oil prices can reduce polyester production costs, making synthetic fibre more competitive against cotton. This can indirectly add pressure to natural fibre prices.
However, weather risks prevented a sharper fall. Extreme heat remains a concern in parts of the US cotton belt, particularly Oklahoma, where high temperatures could affect crop conditions. Weather-related issues in South Texas are also being closely monitored. Any deterioration in crop prospects could provide support to futures despite the ongoing harvest.
China's cotton market remained weak as well. Zhengzhou Commodity Exchange (ZCE) cotton declined for a sixth consecutive session and has closed lower in 10 of the past 11 sessions. The January contract has fallen by around 6.8 per cent over the latest 11-session period, compared with a decline of around 9.4 per cent in ICE December cotton. ICE has therefore remained relatively weaker than the Chinese market during the recent correction.
China's State Reserve auction programme continued on September 16. Around 8,011 tonnes, equivalent to approximately 35,248 bales, were offered in the 43rd auction. Of this, around 7,332 tonnes, or approximately 32,260 bales, were sold, resulting in a sell-through rate of about 91.5 per cent.
This was the second consecutive session in which the State Reserve auction failed to achieve a complete sell-out. Around 343,599 tonnes, equivalent to approximately 1.512 million bales, have now been sold through the programme. After several weeks of strong auction demand, the recent easing in the sell-through rate could become an important indicator of domestic Chinese cotton demand.
Overall, ICE cotton remains under pressure from weak demand, advancing US harvest activity, a stronger dollar and softer crude oil prices. December 2026 cotton settled at 84.36 cents, down 386 points over four sessions and 878 points from its August 31 high. Weather concerns and exceptionally high open interest remain the principal factors that could increase volatility. The market will now closely watch Friday's COT report, the pace of the US harvest, weather developments and demand in China's State Reserve auctions.
This morning (Indian Standard Time), ICE cotton for December 2026 was trading at 84.04 cents per pound (down 0.32 cent). Cash cotton was at 76.69 cents (down 0.66 cent), while the October 2026 contract traded at 80.44 cents (down 0.66 cent). The March 2027 contract was at 86.61 cents (down 0.28 cent), May 2027 at 88.02 cents (down 0.33 cent), and July 2027 at 87.75 cents (down 0.29 cent).
India's DGFT sets up Delhi CPD for faceless trade processing
Thursday, 17th Sep 2026, (Source: www.fibre2fashion.com)
Insights: India's DGFT is establishing a Central Processing Department at CLA Delhi to enable faceless, paperless and jurisdiction-free processing of trade applications. Planned for launch in the second half of October 2026, the system aims to improve transparency, reduce processing time and ease business for exporters and importers, with staff drawn from DGFT headquarters and regional authorities.
India’s Directorate General of Foreign Trade (DGFT) is establishing a Central Processing Department (CPD) at CLA Delhi to implement a Faceless Trade Facilitation System for trade-related applications, a development relevant to exporters and importers that deal with DGFT approvals and filings. The initiative is aimed at faceless, paperless and jurisdiction-free processing of trade-related applications, with the stated objectives of improving transparency, reducing processing time and supporting ease of doing business for exporters and importers. The system is proposed to be dedicated to the nation in the second fortnight of October 2026, according to a DGFT office memorandum dated September 14. CPD will function as a central unit for processing trade-related applications and will comprise officers and staff drawn from DGFT Headquarters and its Regional Authorities. After completing orientation and training, the posted officers will assume charge at CPD, CLA Delhi. The office memorandum was issued with the approval of the competent authority and digitally signed by Sanjeev Shrivastav, Joint Director General of Foreign Trade.
Global cotton production forecast lowered for 2026-27: WASDE
Thursday, 17th Sep 2026, (Source: www.fibre2fashion.com)
Insights: World cotton production for 2026-27 is cut by over 300,000 bales to 117.32 million bales on smaller US, Turkiye and Pakistan crops. Global trade rises to 44.22 million bales as Brazil and African Franc Zone exports meet higher imports in Turkiye, Indonesia and Pakistan. US output falls about 3 per cent to 13.20 million bales, cutting stocks and lifting upland farm price to 78 cents per pound.
World cotton production for 2026-27 has been lowered by more than 300,000 bales in the September estimate to 117.32 million bales of 480 pounds or 220 kg each, from 117.63 million bales projected in August. The reduction reflects smaller crops in the US, Turkiye and Pakistan, which more than offset higher production forecasts for Brazil, the African Franc Zone and Kazakhstan, according to the latest World Agricultural Supply and Demand Estimates (WASDE) report of the United States Department of Agriculture (USDA). Despite the production cut, global cotton supplies for 2026-27 were raised slightly to 192.62 million bales from 192.44 million bales last month, as beginning stocks increased to 75.31 million bales from 74.80 million. Global consumption was unchanged at 122.92 million bales.
International cotton trade is expected to strengthen further. Global trade was raised by around 400,000 bales to 44.22 million bales from 43.82 million in August. Higher exports from Brazil and the African Franc Zone are expected to be absorbed by increased import demand from Turkiye, Indonesia and Pakistan. Brazil's export forecast was raised by 200,000 bales to 15.50 million bales, while its production estimate increased by 250,000 bales to 18.50 million.
With higher beginning stocks more than compensating for part of the production decline, world ending stocks for 2026-27 were raised by around 170,000 bales to 69.86 million bales from 69.69 million in August. The global stocks-to-use ratio therefore edged up to around 56.8 per cent from 56.7 per cent last month.
Amongst major consuming markets, China's 2026-27 outlook was unchanged, with production forecast at 33.50 million bales, imports at 7 million bales and consumption at 42 million bales. India’s production and consumption forecasts also remained unchanged at 24 million and 26.50 million bales, respectively, while imports were maintained at 3 million bales. India’s ending stocks were raised to 10.32 million bales from 10.02 million due to higher beginning stocks.
Turkiye’s production forecast was cut by 300,000 bales to 2.40 million bales, while its import estimate was raised by 200,000 bales to 5 million. Pakistan’s crop was reduced by 100,000 bales to 5 million, with imports increased by an equal amount to 5.10 million. Indonesia’s consumption and imports were each raised by 100,000 bales to 2.10 million. Bangladesh and Vietnam remained unchanged, with imports forecast at 7.40 million and 8.20 million bales, respectively.
The US cotton outlook tightened more substantially. USDA cut 2026-27 production by around 410,000 bales to 13.20 million bales from 13.61 million in August, a decline of about 3 per cent. The national average yield was lowered by 22 pounds to 776 pounds per harvested acre from 798 pounds, while harvested area was reduced marginally to 8.16 million acres from 8.19 million. Planted area was estimated at 10.45 million acres.
US mill use was also cut by 100,000 bales to 1.50 million bales as the country’s textile manufacturing base continues to contract. Exports, however, were left unchanged at 12.30 million bales. With beginning stocks lowered to 4.15 million bales and production reduced, total US cotton supply is now forecast at 17.36 million bales, down from 17.81 million in August.
As a result, US ending stocks for 2026-27 were cut by 10 per cent to 3.60 million bales from 4 million, reducing the stocks-to-use ratio to 26.1 per cent from 28.8 per cent last month. The projected season-average farm price for upland cotton was raised by 3 cents to 78 cents per pound. USDA said yields and production were lower in the Delta and Southwest, while forecasts were slightly higher in the Southeast and West.
For the current 2025-26 season, the US export estimate was raised to 12.30 million bales following year-end trade data from the Census Bureau and other sources. Stronger exports lowered estimated ending stocks to 4.15 million bales, while the season-average farm price was increased to 62 cents per pound from 61.5 cents previously.
The global 2025-26 balance sheet was also revised, with USDA raising imports, consumption and ending stocks, primarily on updated trade data. World consumption is now estimated at 121.13 million bales and ending stocks at 75.31 million bales, implying a stocks-to-use ratio of about 62.2 per cent. Global production for the season is estimated at 121.95 million bales.
Global cotton prices firm as major benchmarks rise in August
Wednesday, 16th Sep 2026, (Source: www.fibre2fashion.com)
Insights: Global cotton prices strengthened in August 2026, with the A Index rising from around 90 cents to 95 cents per pound, according to Cotton Incorporated. The market remains influenced by global production, consumption, export activity and economic conditions. For textile manufacturers, cotton price movements could affect yarn and fabric costs, while demand trends will remain key to the outlook.
Global cotton prices have strengthened over the past month, with most major benchmarks recording gains, as the market weighs changing supply expectations against still-cautious demand. The A Index increased from around 90 cents per pound to 95 cents/lb, according to Cotton Incorporated’s latest Market Fundamentals and Monthly Cotton Price Outlook. The latest movement comes as cotton markets continue to balance production prospects, consumption expectations and broader economic conditions. Price direction remains closely tied to how global supply develops alongside demand from the textile and apparel industry. The US market remains an important factor for global cotton trade, with export activity and crop prospects influencing the balance between available supplies and international demand. Cotton prices have also been sensitive to currency movements and developments in major producing and consuming markets.
In Pakistan, cotton prices have recently been around 78 cents/lb, equivalent to roughly PKR 17,800 per maund, according to Cotton Incorporated's July update, highlighting the variation between regional markets.
For textile manufacturers and yarn spinners, movements in raw-cotton prices will remain an important consideration for procurement and cost management. However, the impact on downstream markets will also depend on yarn demand, mill operating rates, apparel orders and the ability of brands and manufacturers to absorb or pass on higher input costs.
The cotton market is likely to remain sensitive to developments in both production and consumption. Any changes to crop conditions, export availability or textile demand could influence benchmark prices in the months ahead.
For the wider textile value chain, the key issue will be whether firmer cotton prices translate into higher yarn and fabric costs, particularly if demand improves at the same time that mills face tighter margins.
BIS Upgrades 21 Cotton Testing Labs in Key States
Thursday, 17th Sep 2026, (Source: www.money.rediff.com)
BIS invests ₹38.72 Cr to modernize 21 cotton testing labs across major producing states, enhancing quality and strengthening India's textile and agriculture sectors.
· BIS is investing ₹38.72 crore to upgrade 21 laboratories across cotton-producing states.
· The project aims to establish high-precision testing facilities to enhance cotton quality.
· This initiative strengthens India's textile and agriculture sectors by bridging infrastructural gaps.
· Modern equipment like HVI Testers and Trash Analysers are being installed in the labs.
· The goal is to ensure standardized quality parameters across the entire cotton-to-textile supply chain.
Mumbai, Sep 17 (PTI) The Bureau of Indian Standards (BIS) on Thursday announced a Rs 38.72-crore project to modernise and upgrade 21 laboratories across key cotton-producing states, aimed at strengthening the country's textile and agriculture sectors. BIS is providing direct financial support to establish high-precision testing facilities in critical regional nodes, according to an official statement. These laboratories are geographically distributed across the northern, central, southern, and eastern zones.This ensures comprehensive coverage for major cotton-producing regions spanning Punjab, Rajasthan, Gujarat, Maharashtra, Madhya Pradesh, Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, and Odisha. "Significant progress has already been achieved by BIS this year, resulting in the installation and commissioning of 14 HVI Testers and 28 Trash Analysers across 13 laboratories (comprising 11 laboratories of the Textiles Committee and 2 of the Cotton Corporation of India)," the statement added. By establishing this technologically advanced testing network, BIS aims to ensure standardised quality parameters across the entire cotton-to-textile supply chain. The initiative directly bridges critical infrastructural gaps, empowering local producers and positioning Indian cotton for sustained international leadership, it added.
15 Percent Monsoon Deficit Pushes Over Half of India into Drought, Raising Kharif Crop Concerns
Thursday, 17th Sep 2026, (Source: www.eng.ruralvoice.in)
More than 53 percent of India’s area has come under drought conditions, with monsoon rainfall 15 percent below normal. The deficit is higher in southern, western and northeastern regions. The acreage under kharif crops, including paddy, soybean, groundnut, sugarcane and cotton, is lower, while the rainfall shortage is also expected to affect crop production.The impact of El Niño is now becoming increasingly visible, with more than half of the country’s area coming under drought conditions. In some areas, the monsoon rainfall deficit has exceeded 50%. Apart from Punjab, Haryana, Rajasthan and Bihar, all states in southern India are facing the impact. In the Northeast, all states except Nagaland, Mizoram and Tripura are affected. The rainfall deficit is affecting kharif crops. Besides paddy, the acreage under oilseeds, sugarcane and cotton is lower than last year. Even crops standing in the fields face the risk of lower production due to inadequate rainfall.
According to the India Drought Monitor of IIT Gandhinagar, 53.2% of the country’s area was under drought conditions as of September 9, up from 46% a week earlier. Among major states, the affected area stands at 90% in Andhra Pradesh, 86.2% in Telangana and 85.2% in Maharashtra.
Drought conditions according to the India Drought Monitor.
Region-wise, 40% of northern India and 45% of northwestern India are currently affected by drought. The situation is relatively better in central India, where 39% of the area is under drought conditions. However, 82% of western India and 70% of southern India are affected. In eastern India, 45% of the area is under drought conditions, while the figure is 64% in the Northeast.
According to the India Meteorological Department, monsoon rainfall so far this year is 28% below normal in southern states, 25% below normal in eastern and northeastern states, 10% below normal in northwest India and 6% below normal in central India. At the national level, rainfall is 15% below normal. The department has said that the southwest monsoon is likely to begin withdrawing from western Rajasthan from September 19. However, it has forecast good rainfall in Tamil Nadu and Kerala towards the end of this week.
State-wise, rainfall is 40% below normal in Punjab, 23% in Haryana, 25% in Rajasthan, 30% in Karnataka, 20% in Telangana, 42% in Andhra Pradesh, 23% in Tamil Nadu, 27% in Kerala and 36% in Bihar. In the Northeast, rainfall is 26% below normal in Assam, 42% in Arunachal Pradesh, 43% in Manipur and 59% in Meghalaya.
Rainfall situation according to IMD. Blue indicates rainfall above normal; green indicates rainfall between -19% and 19% of normal; red indicates a 20-59% deficit; and yellow indicates a deficit of more than 60%.
The impact of the rainfall deficit is clearly visible on kharif crops. According to information available on the Ministry of Agriculture and Farmers Welfare’s yield portal, paddy acreage is 3.82% lower than last year. Among pulses, except urad, the acreage under other crops is either broadly at last year’s level or lower. The area under coarse cereals is marginally higher than last year, while oilseed acreage has declined. Both major oilseed crops, soybean and groundnut, have recorded a fall in acreage. Soybean acreage is 0.8% lower than last year, while groundnut acreage is down 0.42%.
Sugarcane acreage is also 0.69% lower than in kharif 2025-26, while cotton acreage has declined by 0.88%. Overall, the acreage under all kharif crops is 1.44% lower than last year.
Paddy is expected to be among the crops most affected by the rainfall deficit. Eastern and southern states, where paddy is widely cultivated, have received very little rainfall over the past several weeks. With both acreage and rainfall lower, there are concerns that rice production could also decline this year. Farmers had also faced fertilizer shortages at the beginning of the season.
Besides paddy, other kharif crops are also expected to be affected. In some rain-fed areas of Maharashtra, there have been reports of farmers destroying soybean crops by running tractors over them due to crop stress caused by inadequate rainfall.
