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The 2025/26 U.S. cotton balance sheet has been revised downward, with reduced production, beginning, and ending stocks. Delayed planting and rainfall in the Delta cut the harvested area and yield, pushing production down to 14.0 million bales—second lowest in a decade. Ending stocks drop to 4.3 million bales, lowering the stocks-to-use ratio to 30.3%. Globally, production and consumption are revised down, with China seeing gains offset by declines in India, the U.S., and Pakistan. Ending stocks are reduced by 1.6 million bales due to smaller crops and lowered carry-in. Despite these changes, U.S. cotton prices remain steady at 62 cents/lb.

Key Highlights

* U.S. cotton production cut to 14.0 million bales for 2025/26.

* Lower harvested area and yields due to Delta weather.

* Ending stocks fall to 4.3 million bales, second lowest in 10 years.

* World cotton output down 800,000+ bales; China gains offset by India, U.S., and Pakistan losses.

* Season-average U.S. cotton price holds steady at 62 cents/lb.

Cotton prices held firm as the USDA revised the 2025/26 U.S. cotton outlook, highlighting significant supply-side constraints. Despite lower output projections, the season-average price remains unchanged at 62 cents per pound, reflecting a cautiously balanced market sentiment.

Supporting the price firmness is a reduced U.S. production forecast, now pegged at 14.0 million bales—down 500,000 from last month. This decline stems from adverse weather in the Delta region, which cut the harvested area by 2% to 8.19 million acres and reduced yield expectations by over 1% to 820 pounds per acre. Additionally, 2025/26 beginning stocks were lowered by 400,000 bales due to increased 2024/25 exports. As a result, ending stocks drop to 4.3 million bales, yielding a tight stocks-to-use ratio of 30.3%.

Globally, the cotton landscape also turned more bearish on supply. World production is now forecast to fall over 800,000 bales, as gains in China are outweighed by steep cuts in India, the U.S., and Pakistan. Consumption is reduced by over 300,000 bales, primarily due to lower demand from India, Turkey, and Bangladesh. World trade sees a marginal dip of 40,000 bales, though these changes are largely offsetting.

Ending global stocks are projected nearly 1.6 million bales lower, driven by a significant cut in India’s 2024/25 output and weaker production outlook across key regions.

Finally

Tightening supplies in both U.S. and global markets are offering fundamental support to cotton prices, even as demand shows signs of softness.

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