# Cotton: Cycles

Why cotton is at a fifteen-year real low

Source page: https://www.materialinsights.org/commodities/cotton/cycles/

What this tab covers Price history and what drives booms and busts, including this commodity's super-cycles, the drivers behind them and the metrics to track. It charts monthly prices (World Bank) with a switch to inflation-adjusted annual prices; where there is no World Bank series it uses USGS US prices.

The World Bank A Index was $2.10 per kg in September 2026, up from $1.72 a year earlier but below $2.29 five years ago. The ten-year range was $1.40 to $3.61, while the peak since 2000 was $5.06. In real 2010 dollars the 2025 average of $1.47 was the lowest in fifteen years, against $3.00 in 2011. Because cotton is planted each season, farmers can switch acreage quickly, so price spikes tend to correct fast. Polyester competition, Chinese reserve policy and the dollar shape the cycle.
 Latest (2026-09) 2.10 $/kg vs 1 year ago +22% vs 5 years ago -8% vs 10 years ago +22%

#### Cotton, A Index price

Chart: Cotton, A Index monthly price

Chart: Cotton, A Index annual real price
 Deflated by the World Bank manufactures unit value index (2010 = 100). Source: World Bank Commodity Price Data (Pink Sheet), October 2026 release.

#### Super-cycles in cotton

Cotton has sharp price spikes rather than long super-cycles, because it is planted each year and farmers switch area quickly. The World Bank A Index sat near $0.65/kg through the 1960s, roughly doubled in the 1973-74 commodity boom and has traded mostly between $1.0 and $2.5/kg since. The one true blow-out came in 2010-11, when the index hit $5.06/kg (March 2011) on low stocks, Chinese buying and export curbs, then halved within a year. Government stockholding, above all in China, and competition from cheap polyester cap rallies. In real 2010 dollars the 2025 average of $1.47/kg was the lowest in fifteen years.

1. 1972-1974

A broad commodity boom, high oil prices and strong demand doubled cotton prices before recession cut use.

A Index annual average from $0.83/kg (1972) to $1.46/kg (1974) (World Bank)

2. 1994-1995

Chinese crop losses and heavy Chinese imports drew down stocks.

annual average $2.13/kg in 1995, monthly average peak $2.53/kg (May 1995)

3. 1999-2002

Large US crops supported by subsidies, a strong dollar and weak demand pushed prices to multi-decade lows; Brazil later won a WTO case against US support.

monthly average low of $0.82/kg (Oct 2001); annual average $1.02/kg in 2002

4. 2010-2012

Stocks were low after the financial crisis, China bought heavily and India curbed exports. China then built huge state reserves at support prices, which kept world prices low for years after.

monthly average from $1.14/kg (Mar 2009) to an all-time high of $5.06/kg (Mar 2011), then $1.81/kg (Jun 2012); annual average $1.97/kg in 2012

5. 2021-2026

Post-Covid restocking and freight disruption lifted prices, then slow demand and large Brazilian crops pushed them down. A partial recovery came in 2026 as stocks outside China fell.

monthly averages: peak $3.61/kg (May 2022), low $1.63/kg (Dec 2025 and Feb 2026), $2.10/kg in Sep 2026

#### What drives the cycle

- **China's reserve and import policy.** China holds about 48% of world stocks; reserve buying or auctions and import quotas can add or remove millions of bales from world trade.
- **Polyester competition and oil prices.** Polyester is made from oil and gas derivatives; when it is cheap, mills blend more of it and cotton demand slows (Geman).
- **Weather in a few growing areas.** West Texas rainfall, the Indian monsoon, Australian water allocations and Brazilian second-crop planting decide most supply swings.
- **Farm support and trade policy.** India's MSP, US farm programmes, import duties and forced-labour rules on Xinjiang cotton change where cotton flows and at what price.
- **Garment demand and retail cycle.** Cotton use tracks clothing sales and retailer inventory cycles in the US and EU.

#### Metrics to track

| Metric | Why it matters | Where to track it |
|---|---|---|
| **World and country supply and use, stocks-to-use** | Monthly anchor for the balance | USDA WASDE (monthly) |
| **US weekly export sales** | Shows who is buying US cotton and how fast | USDA Foreign Agricultural Service, every Thursday |
| **World stocks excluding China** | Better measure of cotton available to the market than world totals | USDA WASDE 'World Less China' line |
| **Indian crop and pressing estimates and CCI procurement** | Tracks India's crop, arrivals and how much goes to the state | Committee on Cotton Production and Consumption (Ministry of Textiles); Cotton Corporation of India |
| **Cotlook A Index and ICE No. 2 futures spread** | Measures world physical price against the US futures benchmark | Cotlook Ltd; ICE Futures US |
| **Fund positioning in cotton futures** | Speculators often drive short-term moves | CFTC Commitments of Traders, weekly |

## Other sections

- [Summary](https://www.materialinsights.org/commodities/cotton/index.md)
- [Overview](https://www.materialinsights.org/commodities/cotton/overview/index.md)
- [Correlation](https://www.materialinsights.org/commodities/cotton/correlation/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)
- [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)