Read the market before you ask

Read these in this order

Each one links to the module that carries that number. The two readings under it are reference points, not thresholds, and under those are the outside places worth going to check the number at its source.

1. 1
   The world reference price

   Cotlook A and the ICE nearby contract, which are the two numbers every cotton conversation starts from.

   No action needed when the index and the futures are close together and both are inside the range they have held for the last couple of months.

   Worth a second look when the gap between the physical index and the futures widens. It usually means the physical market and the paper market have stopped agreeing, and the physical one is the one you will actually be invoiced on.

   Learn further, at the source other people's sites, free unless marked paid

   • USDA cotton market news (opens in a new tab) the weekly US spot average and the adjusted world price at source, free and public domain
   • ICE Cotton No. 2 futures (opens in a new tab) the futures side of the pair, with the contract specification so you know what the quoted month actually is
   • World Bank Commodity Price Data (the Pink Sheet) (opens in a new tab) the free lawful route to the Cotlook A monthly averages, which is what the five year cotton chart is drawn from
   • IndexMundi, cotton (opens in a new tab) the same index charted over years, so you can judge whether today's level is unusual or ordinary
2. 2
   The world balance

   The WASDE stocks-to-use ratio, which is the closest thing this trade has to a fuel gauge.

   No action needed when stocks-to-use is steady month on month and the revisions are small in both directions.

   Worth a second look when production is cut and mill use raised in the same report. Two small changes in opposite directions do more to the balance than one large change in either.

   Learn further, at the source other people's sites, free unless marked paid

   • USDA WASDE report (opens in a new tab) the monthly balance sheet itself, so you read the stocks-to-use line and the revisions rather than someone's summary of them
   • USDA Economic Research Service, cotton and wool (opens in a new tab) the outlook write-up that explains why area, yield and use were changed this month
   • International Cotton Advisory Committee (opens in a new tab) a second, non-US estimate of world supply and use, worth having when a WASDE revision looks large
3. 3
   The crop in the ground

   Crop condition, drought category and heat days in the growing regions, which is where next season’s supply is decided.

   No action needed when conditions are near their normal range and drought categories are stable or easing.

   Worth a second look when drought deepens in Texas, or heat days climb in Punjab and Sindh during flowering. Cotton sheds bolls under heat stress and does not get them back.

   Learn further, at the source other people's sites, free unless marked paid

   • USDA NASS Crop Progress (opens in a new tab) the weekly condition rating by state, which is the raw series the crop module is built from
   • US Drought Monitor (opens in a new tab) the drought category shares week by week, the physical cause sitting under a falling condition rating
   • NASA POWER (opens in a new tab) free daily heat and rainfall for any point, so you can check flowering conditions in Punjab and Sindh yourself
   • Pakistan Cotton Ginners Association (opens in a new tab) fortnightly seed cotton arrivals by district, the earliest hard count of what the Pakistani crop actually delivered
4. 4
   Who is holding the risk

   Managed money net position and the unfixed on-call sales, which together say how crowded the market is.

   No action needed when the net long sits in the middle of its own range and on-call is unremarkable.

   Worth a second look when a very large net long, because a crowded trade unwinds faster than it builds; or a heavy unfixed on-call position, because those sales have to be priced eventually and the fixing is itself buying.

   Learn further, at the source other people's sites, free unless marked paid

   • CFTC Commitments of Traders (opens in a new tab) the weekly managed money net position at source, so you can see for yourself how crowded the trade has become
   • CFTC Cotton On-Call report (opens in a new tab) unfixed call sales by futures month, which is buying that has been promised and still has to be executed
5. 5
   The alternative fibre

   The polyester chain and its feedstocks, which set the price of the substitute.

   No action needed when polyester is flat while cotton moves, which leaves the blend ratio available to you as a lever.

   Worth a second look when polyester is rising with oil at the same time as cotton. The escape route closes exactly when you want it, and blended yarn prices then move on both legs at once.

   Learn further, at the source other people's sites, free unless marked paid

   • Zhengzhou Commodity Exchange (opens in a new tab) the Chinese futures for PTA, paraxylene and polyester staple, which set the Asian price of your substitute
   • SunSirs, China polyester staple fibre price (opens in a new tab) the free daily spot assessment for the fibre itself, the price the physical market paid on the day, which is the number to read against the futures month above it
   • Crude oil prices (opens in a new tab) the feedstock at the root of the polyester chain, and the thing to check before assuming the blend lever is still open
   • YarnsandFibers (opens in a new tab) polyester chain price trends in one place, useful for telling a feedstock move from a fibre move

Reference points, not advice. They describe what the numbers have done, and they do not know your quality, your terms or what you have already covered.