Sugar Prices Hit 4½-Year Low

SUGAR

The UNICA report on the Brazilian Center-South sugar crop for the first half of September is expected to be released this week, perhaps tomorrow, and a survey of analysts by S&P Global expects sugar production for the period to be around 3.6 million metric tons, up 15% from the same period a year ago. This would put cumulative production for the 2025/26 marketing year (which began April 1) down just 0.2% from a year ago after being down 14.7% in mid-June. Better than expected production out of Brazil and good growing conditions for India and Thailand have been the key factors sending sugar prices to their lowest levels in 4 ½ years. Friday’s Commitments of Traders Report showed managed money traders were net sellers of 22,462 contracts of sugar for the week ending September 23, increasing their net short to 151,598. This is their largest net short since November 2019, leaving the market vulnerable to short covering if resistance levels are taken out. Citing European traders, Reuters reported today that the Pakistan state agency the Trading Corporation of Pakistan (TCP) has issued a tender to purchase 100,000 tons of white refined sugar and is believed to have bought 80,000 tons in a tender that closed last week. World Weather Inc says Brazil’s Center west and center south crop areas will remain drier biased for ten days.

COTTON

December Cotton is higher this morning having found support at last week’s lows. The slow pace of US exports remains a concern, with last week’s export sales report coming in at their lowest level since the 2025/26 marketing year began. Cumulative sales have only reached 36% of the USDA’s forecast for the marketing year versus a five-year average of 53% for this point in the season. President Trump unveiled new import tariffs last week, including 100% duties on branded drugs and 25% levies on heavy-duty trucks, and this development could keep US export prospects poor, especially if it effects some of the US’ biggest buyers such as Vietnam or Pakistan or China. The upcoming meeting between Trump and Chinese President Xi may increase hopes for some sort of trade agreement, though cotton will not be the biggest item on the agenda. World Weather Inc. says warm temperatures and limited rainfall across Texas during the next week to ten days will help expedite the development of cotton in the west and support maturation and harvesting in the Blacklands. The Delta received some rain last week that may have discolored open boll cotton fiber, but dry weather through Saturday with warm temperatures should bleach the crop white again. Xinjiang, China crops are rated favorably, with some harvesting underway. In the US, harvest pressure could be a new impetus to push the market lower.

COFFEE

December Coffee extended last week’s recovery rally overnight and traded to its highest level since September 17. It also achieved the 50% retracement of the selloff from the September 16 contract high to last week’s low. The market is awaiting a meeting this week between President Trump and Brazilian President Luiz Inácio Lula da Silva to see if some sort of compromise agreement can be worked regarding the 50% tariffs on Brazilian exports to the US. So far the tariffs have led to a squeeze on US supplies and a sharp drawdown in exchange stocks that inspired a rally to contract highs. The head of the Brazilian exporters group Cecafe said last week that the tariff restrictions may be good for producers in the near term, but that the US market is “too big” for other countries to replace. If tariffs remain in place for too long, Americans could grow used to other types of coffee, making it harder for Brazilian companies to recover their position in the US market in the future. The warehouse manager for Cooabriel, Brazil’s biggest cooperative for Conilon (a type of robusta coffee) said some producers are holding on to their supplies, betting prices will return towards recent records. He added they have a very high stock level for this time of year. Typhoon Bualoi made landfall in Vietnam yesterday, producing wind speeds of up to 93 mph and torrential rains. World Weather Service says some coffee (robusta) damage cannot be ruled out in northern areas, but assessments will not likely begin until Tuesday when conditions improve enough to allow producers back into their Plantations. The main producing area in the Central Highlands received rain from the storm as well with most areas getting moderate to heavy amounts, not as severe as areas to the north, but more than sufficient to induce significant runoff and a little local flooding.

COCOA

December Cocoa was higher overnight and traded right up to the 9-day moving average. The market fell to its lowest level since mid-July last week on the return of seasonal rains in West Africa and perhaps renewed concerns about demand. The 3^rd quarter grind numbers for Asia, Europe, and North America are due to be released on October 16. The weather maps over the weekend showed a little rain in Ivory Coast but substantial amounts in Ghana and some in central Nigeria and Cameroon. World Weather Inc. expects the entire region to seen routine showers and thunderstorms during the next week to ten days with all cocoa production areas impacted, enough to maintain wet soil conditions and support normal crop development. One supportive factor has been ICE exchange stocks, which fell 6,259 bags on Friday to 1.980 million, the lowest since April 25. Stocks were down 42,084 last week. The trade is awaiting the start of the West African 2025/26 main crop.

Interested in more futures markets?  Explore our Market Dashboards here.