December Cotton Slips on Weak Export Hopes

COTTON

December Cotton is lower today but inside yesterday’s range after failing to take out the October 28 high yesterday. Traders may have been holding out hope that China will buy US cotton. So far the details of the deal have mentioned soybeans, not cotton and US soybean prices have rallied off the news. The recent rally dollar undermines US export prospects. Unfortunately, we are in the dark about US exports. Hedge pressures may be easing as we move through harvest. The crop is usually about 50% harvested by now. La Niña is showing signs of life, and World Weather Inc. says the wetter bias in India may be associated with that phenomenon, along with wetter conditions ins Southeast Asia and northeastern and east-central Australia. La Nina is expected to be short lived and not very intense, which might limit the amount of excess rain. India is facing some quality issues after recent heavy rains.

COCOA

December Cocoa broke through its October 25 high yesterday and held those gains overnight. Some analysts have tempered their forecasts for the West African main crop due to a dry spell in late summer and some persistent concerns about Cameroon’s crop. Ivory Coast farmers interviewed by Reuters this week said adequate levels of rainfall mixed with long sunny spells should help the main October-to-March cocoa crop last and to be of good quality. The dry season runs from mid-November to March, and if it is mild, the main crop should last longer. Growers also said that harvesting was increasing in most cocoa-growing regions and that deliveries of good quality beans were sharply rising in the warehouses of cooperatives. Yesterday it was reported that Ivory Coast port arrivals totaled 90,000 metric tons for the week ended November 2, up from 82,000 the previous week and 80,000 a year ago. This was the largest total for this week of the marketing year in at least five years and was well above the five year average for that date. Cumulative arrivals for the 2025/26 marketing year (which began on October 1) have reached 304,000 tons, down from 365,000 at this point last year and below the five-year average of 363,600. World Weather Inc. says periodic showers and thunderstorms are expected through the next week to ten days from southern Ivory Coast through southern Ghana and Nigeria to Cameroon. Most of the rain will be light to moderate with short term bouts of heavier rainfall. The overnight maps showed limited rains over the last 24 hours, hugging the southwest coast of Ghana. ICE stocks increased 4,620 bags yesterday to 1.820 million. This was the first daily increase since October 20.

COFFEE

December Coffee traded to its highest level since October 23 overnight, which was the day it put in its contract highs. US roasters reportedly are “plowing through their stockpiles” of coffee as they wait for an agreement between the US and Brazil that would lift the 50% tariff, and there has been no news on that subjects since last week. Oral argument in front of the US Supreme Court over the legality of some of the Trump tariffs are to begin Wednesday. Bloomberg reports that rainfall in Brazil’s biggest arabica coffee growing region (southern, southwest Minas Gerais) measured 33.4 millimeters in the past week or 75% of the historical average. World Weather Inc. says the current forecast suggests frequent showers and thunderstorms over the next ten days. A strong rise in the Southern Oscillation Index (SOI) during the second half of October suggests that La Niña could finally be arriving. Up to now the phenomenon had not developed enough to affect world weather patterns, but that may begin to change. However, La Niña conditions are expected to be short-lived and confined to the next two months. These expectations are supported by the increase in predicted rainfall for center west and center south Brazil over the next couple of weeks. ICE certified stocks fell 247 bags yesterday to 431,481, their lowest since March 11, 2024.

SUGAR

March Sugar is lower this morning after failing to take out yesterday’s one-week high. The market may have gotten oversold on the ample global supply news and the recent move to its lowest level in five years, but the three-day rally corrected it. The Brazilian forecasting firm Conab lowered its forecast for Brazil’s 2025/26 cane crop to 666.45 million metric tons from 668.82 million in their previous forecast. The Center-South cane crop was lowered to 607.38 million from 609.76 million previously. However, total sugar production was increased to is 45.02 million tons from 44.46 million previously, and Center South production was raised to 41.34 million from 40.64 million. Cane-based ethanol production is estimated at 26.55 billion liters, down from 26.76 previously, and total ethanol production (including corn) was increased to 36.16 billion from 35.74 billion previously. The last UNICA report did show a switch to more ethanol production from cane for the first half of October, which does at least increase possibility of a slowdown in sugar production.

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