A quick overview of the cotton market performance on March 2nd

US Cotton (ICE): The May contract fell 102 points (-1.55%) to close at 64.59 cents per pound, a new low since February 20.

Zhengzhou Cotton: The CF2605 contract fell 105 points to close at 15,225 RMB/ton.

Spot Market: According to data from SunSirs, as of March 3, the spot price of 3128B grade cotton was 16,594 RMB/ton, a decrease of 0.26% from the previous day.

The impact of the Middle East situation (US-Iran conflict) on cotton prices

Escalating tensions in the Middle East prompted risk aversion in the market, with the US dollar index rising to a more than one-month high and putting downward pressure on commodities. The ICE cotton futures main contract fell by 100 points.

The conflict exacerbated global economic and inflationary uncertainties, dampening expectations for textile and apparel consumption.

The closure of the Strait of Hormuz pushed up international oil prices, increasing the cost of raw materials for synthetic fibers (PX, PTA, etc.), which may benefit cotton prices.

Market Outlook:

In the short term, escalating conflicts in the Middle East are driving safe-haven demand, potentially putting downward pressure on domestic and international cotton prices. However, the fundamental tight balance in the global cotton market remains unchanged. Textile mills have largely resumed full production, with the operating rate in major regions reaching 64.6% as of the 27th. Downstream market purchases are gradually emerging, but overall, caution remains, with limited restocking and widespread resistance to price increases.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.