Did you know Cotton could be Explosive?
Literally and as an investment
On Saturday, while reading a book on commerce, I learned that cotton is essential to the production of gun ammunition.
Huh?
Apparently, it’s called “Gun Cotton” and is a part of cordite.
You can learn the history of it from the US Naval Institute HERE
Or watch a video from Civil War Hobbyists
But it’s still relevant for war, and apparently, Russia needed to buy a lot more cotton for its depleted arsenal.
From 50 to 1225 tonnes
What if the US starts to build up its arsenal and also helps our farmers who may not have ethanol subsidies?
This question may not be well-informed, I admit, but I asked ChatGPT how Russia’s orders would translate to futures contracts.
Assumption: Cotton futures = ICE Cotton No. 2, which is the global benchmark.
1. ANSWER TO QUERY 1
Contract specs
1 futures contract = 50,000 pounds
1 metric ton = 2,204.62 pounds
Convert tons to pounds
1225 metric tons × 2,204.62 lbs
= ≈ 2,700,659 pounds
Convert pounds to futures contracts
2,700,659 ÷ 50,000
= ≈ 54.01 contracts
✅ Final answer
1,225 metric tons ≈ 54 cotton futures contracts
Why this matters (macro angle)
That sounds small in futures terms, but remember:
Futures represent deliverable quality cotton, not raw cellulose
Military-driven demand often shows up off-exchange first, then tightens spreads, basis, and nearby contracts
The signaling value matters more than the raw contract count
But Gun Cotton is a small % of cotton, so “in theory” if the Russians ordered it on the US exchanges, what would it look like?
2. ANSWER TO QUERY 2
Scaling it to your earlier number (optional but powerful)
If we apply this to 1,225 tons of gun cotton:
1,225 × 4.4 ≈ 5,390 contracts
1,225 × 5.3 ≈ 6,490 contracts
That’s material size in futures terms — but it never shows up there because the pressure expresses itself in:
Linters
Cellulose
Chemical capacity
Export controls
The key takeaway
Military cellulose demand doesn’t trade cotton futures —
but if it did, it would be visible.
So, with this information, in a speculative nature, I could be wildly off base, watching cotton may help inform us if war is indeed coming to the home front.
In the meantime, Cotton is cheap, and there are few investment opportunities in it.
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