# Cotton: Correlation Prices it moves with, and why Source page: https://www.materialinsights.org/commodities/cotton/correlation/ Cotton is priced on the New York exchange and in the Cotlook A Index. Prices depend on harvests in India, China, the United States and Brazil, Chinese state stock policy, textile demand and the price of polyester. Market price **World Bank Pink Sheet: Cotton, A Index** $/kg · monthly, Jan 2006 to Sep 2026 #### What its price moves with Selected link ##### Cotton and Polyester fibre Monthly changes 0.07 little or none correlation 12-month changes 0.35 weak correlation Last 5 years 0.21 monthly changes Lead or lag −6 mo Cotton tends to lead by 6 months (r 0.31) Price function, Jan 2006 to Sep 2026 Cotton ≈ 0.171 × (Polyester fibre)^0.50 R² 0.15 On this fit, a 10% higher polyester fibre price goes with a 4.9% higher cotton price over the long run. Units: $/kg and index (BLS base period). The fit is loose, so treat the function as a rough guide. Chart: Cotton and Polyester fibre prices rebased to 100 at Jan 2006, log scale Both prices rebased to 100 at Jan 2006, on a log scale so equal percentage moves look the same size. Chart: Cotton price against Polyester fibre price, monthly, log scales, with fitted line Each dot is one month; paler dots are older (2006), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic. Chemical [PSF Polyester fibre](https://www.materialinsights.org/chemicals/polyester_fibre/)Substitute fibre 0.07 Polyester is the main rival to cotton in clothing, and mills shift blends when the price gap widens. The polyester index follows oil more than cotton: monthly moves correlate at 0.07, yearly moves at 0.35. little or none co-movement month to month · 249 months Show charts Chemical [VSF Viscose fibre](https://www.materialinsights.org/chemicals/viscose/)Substitute fibre Viscose, made from wood pulp, competes with cotton for soft fabrics, and Chinese and Indian mills switch on price. Viscose has no public price series here, so the link is shown as text only. Not enough overlapping price history to measure. Commodity [Wl Wool](https://www.materialinsights.org/commodities/wool/)Substitute fibre 0.36 Wool and cotton are both natural fibres for clothing, sold to the same spinning mills in China. Monthly moves correlate at 0.36 and yearly moves at 0.61, reflecting textile demand and the global economy. weak co-movement month to month · 249 months Show charts Energy [Oil Crude oil](https://www.materialinsights.org/energy/crude_oil/)Energy price link 0.37 Oil sets the price of polyester, cotton's rival, and of fuel and fertiliser for farms. Crude oil and cotton correlate at 0.37 for monthly moves and 0.61 for yearly moves, a common driver rather than a direct input. weak co-movement month to month · 249 months Show charts Energy [Agr Energy in farming](https://www.materialinsights.org/energy/e_agri_energy/)Energy cost 0.32 Diesel for tractors, pumps for irrigation and fuel for ginning are cotton farm costs, and diesel also tracks the oil that prices polyester. The diesel proxy correlates at 0.32 for monthly moves and 0.59 for yearly moves. weak co-movement month to month · 249 months Show charts Commodity [Soy Soybeans](https://www.materialinsights.org/commodities/soybeans/)Competing crop 0.27 In the United States and Brazil, cotton competes with soybeans and maize for land. Monthly moves correlate at 0.27 and yearly moves at 0.52, as farmers adjust plantings to relative prices. weak co-movement month to month · 249 months Show charts How to read these numbers **Correlation of monthly changes** (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak. **12-month changes** compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs. **Price function** is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)^β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation. **Lead or lag** checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months. Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link. Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site. ## Other sections - [Summary](https://www.materialinsights.org/commodities/cotton/index.md) - [Overview](https://www.materialinsights.org/commodities/cotton/overview/index.md) - [Extraction](https://www.materialinsights.org/commodities/cotton/extraction/index.md) - [Production](https://www.materialinsights.org/commodities/cotton/production/index.md) - [Stocks](https://www.materialinsights.org/commodities/cotton/stocks/index.md) - [Cycles](https://www.materialinsights.org/commodities/cotton/cycles/index.md) - [Trading](https://www.materialinsights.org/commodities/cotton/trading/index.md) - [Movement](https://www.materialinsights.org/commodities/cotton/movement/index.md) - [Criticality](https://www.materialinsights.org/commodities/cotton/criticality/index.md) - [Characteristics](https://www.materialinsights.org/commodities/cotton/characteristics/index.md) - [Emissions](https://www.materialinsights.org/commodities/cotton/emissions/index.md) - [Relationships](https://www.materialinsights.org/commodities/cotton/links/index.md)