US cotton spot prices saw a notable pullback in late June: for the week ending June 25, the average price for base quality cotton in seven designated markets was 70.84 cents/lb, down 28 points from the previous week. However, this level remains 5.79 cents higher than the same period last year, indicating an overall upward shift in the market's center. The most-active ICE December contract closed at 76.97 cents/lb on Thursday, up 0.93%, providing some support to the spot market.
A key metric to watch: total 2025/26 marketing year (starting August 1) spot sales have reached 1.516 million bales, a staggering 55.6% increase from 974,340 bales a year ago. This signals that downstream mills and traders are locking in supplies early, converting expectations of future tightness into actual procurement.
Regional Weather Divergence Intensifies: Drought Relief vs. Waterlogging Crisis
Major US cotton-growing regions experienced a rare 'fire and ice' pattern this week. The Southeast—Alabama, Georgia, and the Carolinas—received widespread thunderstorms with 2-4 inches of rain, locally heavier. The US Drought Monitor confirmed that this rainfall significantly reduced drought coverage and improved soil moisture. Alabama's cotton squaring rate reached 40%, Georgia's 30%, with early-planted fields entering the boll-setting stage. This area is now weather-favorable for growth, supporting yield prospects.
In stark contrast, Texas in the Southwest tells a different story. East Texas saw persistent rain after early-week showers, leaving soils saturated and halting field work. Some fields suffered runoff and waterlogging, with cotton plants in low-lying areas showing yellowing leaves. The northern Coastal Bend recorded over 20 inches of rain in the past 60 days, refilling reservoirs like Lake Corpus Christi—a 'sweet sorrow' for growers: drought risk is eliminated, but waterlogging risk rises. Industry sources report most fields are still on track, but recovery in waterlogged areas will determine final yields.
More extreme damage occurred in the Texas High Plains: on June 23, severe thunderstorms spawned tornadoes and hail ranging from golf-ball to tennis-ball size, hitting some cotton fields. Local damage assessments are underway, and some dryland cotton has been insured and scheduled for replanting to sorghum. This means effective planted acreage in this region could shrink further.
Data Signals: How Should Buyers Respond?
The spot price fluctuated between 69.28 and 72.68 cents/lb during the week, a range of 3.4 cents. This high volatility, combined with extreme weather divergence, complicates procurement decisions. The 55.6% surge in season-to-date sales suggests the market has already priced in some supply risk—but the uncertainty of replanting in West Texas is not yet fully reflected.
For buyers, the current spot level around 70 cents/lb is moderately low by historical standards, but the futures premium of 76.97 cents/lb implies the market does not see a bearish outlook. If East Texas waterlogging persists and West Texas replanting expands, the supply window before the August new crop could narrow.