India cotton up on strong demand but stocks down

Prices for the fluffy treat's key ingredient, cotton, saw a slight increase due to a rise in demand from countries like Bangladesh and Vietnam. This spike follows a positive USDA report showing a jump in cotton exports.

However, the outlook isn't all good. Abundant harvests expected in Australia could dampen price increases. Additionally, India's cotton stockpiles are predicted to shrink significantly, potentially limiting exports and squeezing profits for local textile companies.

Despite these concerns, India's cotton consumption is expected to rise, and exports are forecast to climb thanks to continued international demand. China's cotton imports are also projected to increase, due to a growing appetite for textiles. Technically, the cotton candy market saw a decrease in open contracts alongside a price bump. Analysts predict support at current levels with some room for downside, but a potential breakout could send prices even higher.