US cotton spot prices edged lower in the final week of June, but new-crop cumulative sales have more than doubled. This apparent contradiction actually reveals a key dynamic in today's cotton market: short-term supply abundance is coexisting with long-term supply uncertainty, prompting downstream buyers to lock in volumes early.
For the week ending June 25, the USDA-reported average spot price for base-quality cotton across seven designated markets stood at 70.84 cents/lb, down 28 points from the prior week. The weekly range spanned from a low of 69.28 cents/lb on Wednesday to a high of 72.68 cents/lb on Monday. Despite the week-on-week decline, the price was still significantly higher than the 65.05 cents/lb recorded a year ago, representing a year-on-year increase of roughly 8.9%.
New-Crop Sales Surge, Reflecting a Shift in Buying Logic
The most striking figure in the report is the cumulative spot sales volume for the 2025/26 marketing year (which began August 1). As of June 25, total sales reached 1.516 million bales, compared to just 974,340 bales at the same point last year, a jump of 55.8%. This means that even as spot prices fell, buyers did not hold back; instead, they accelerated their purchases.
This 'price-down, volume-up' divergence suggests that current buyers are no longer focused solely on short-term price fluctuations. Instead, they are pricing in expectations of reduced planted acreage for the 2026/27 season, increased frequency of extreme weather events, and ongoing global inventory destocking. For Chinese textile mills, this is a clear signal: waiting for even lower prices could mean missing out on premium-quality cotton.
Regional Weather Divergence: Southeast Benefits, Southwest Struggles
Weather conditions across the main US cotton-growing regions diverged sharply during the week. The Southeast received widespread thunderstorms, with Alabama, Georgia, and the Florida Panhandle recording 2 to 4 inches of rainfall. The US Drought Monitor reported that the heavy rain significantly reduced the area and severity of drought in these regions, providing ample soil moisture for cotton squaring and early boll formation. North Carolina reported a squaring rate of 31%, while Georgia reached 30%.
In contrast, the situation in the Southwest, particularly Texas, was more complex. Eastern Texas suffered from excess rainfall, leading to waterlogged soils, field erosion, and ponding in some cotton fields, which halted field operations. More critically, on June 23, the High Plains region was hit by severe thunderstorms, including tornadoes and hail ranging from golf ball to tennis ball size. Some cotton fields were heavily damaged. Local authorities have initiated insurance assessments, and multiple dryland fields are being considered for replanting to grain sorghum.
The potential impact of this disaster on the 2026/27 Texas cotton crop should not be underestimated. Texas is the largest cotton-producing state in the US, and any reduction in its planted acreage will directly compress national supply. Farmers switching to sorghum means that these acres will not contribute to cotton production in the coming season.
Futures Market Sentiment Improves, But Upside May Be Limited
While spot prices weakened, ICE cotton futures for December delivery rebounded on Thursday, June 26, gaining 0.71 cents to settle at 76.97 cents/lb, up 0.93%. The futures rally was driven more by supply concerns stemming from the Texas weather damage than by improvements in spot fundamentals.
Looking at the spread structure, the basis between spot and futures remains narrow, indicating that physical delivery markets are not tight. Overseas mill inquiries remained light, with only Mexico, Peru, and Turkey showing relatively strong buying interest. This pattern of 'strong futures, weak spot' often suggests the market is waiting for more definitive signals of production losses before embarking on a sustained uptrend.