ADMIS News
COFFEE
The coffee market received more bearish news yesterday with the Brazilian trade group Cecafe reporting that Brazil exported 3.9 million bags of green coffee during April, up 61% from the same period last year. January-April shipments totaled 16.2 million bags, up 42% from last year. Arabica shipments totaled 3.22 million, up 40%, and conilon (robusta) shipments totaled 677,000, five times what they were a year ago. ICE exchange coffee stocks rose by 9,852 bags on Monday and were up 61,000 bags for the month so far. Crop weather in Vietnam has turned favorable recently after hot and dry conditions earlier this year.
COCOA
July cocoa recovered slightly overnight after finishing yesterday with tis biggest single-day loss since 1960. A shift towards wetter weather over West African growing areas has become a significant source of pressure, along with the general idea that the market priced in the tight supply setup with its move to all-time highs. However, West African trees still face stress from the hot and dry conditions earlier this year, and global supplies are still tight. Rabobank said over the weekend that it expects a fourth straight global supply deficit in 2024/25, but that it would be smaller than the one for 2023/24. Farmers across most of Ivory Coast’s main growing region said that so far there has not been enough rainfall to ensure good production during the last stage of the mid-crop. The only exception was Abengourou, where rains were well above average last week and have been throughout the month of May.
SUGAR
July sugar broke below its April/May consolidation yesterday, leaving a downside target of 17.94. UNICA is expected to issue a report on Brazil Center South sugar production for the second half of April in the next few days, and traders are looking for a 50% increase from a year ago. Output in the first half of April was up 31% from the same period last year. Dry conditions this year in Brazil have gotten the harvest off to a fast start, but there are concerns that it could lead to lower yield as the season progresses. China’s agriculture ministry forecast a 10.6% increase in sugar output in 2024/25, to 11 million tonnes.
COTTON
Soil moisture conditions in Texas are much better than they were a year ago, which puts the crop in a good position at the start of the season. At the low earlier this month, prices had fallen 27% from the February high, which may leave the market vulnerable to short covering if there is a weather scare. The weekly Crop Progress report showed 33% of the US cotton crop was planted as of Sunday, up from 24% the previous week and slightly ahead of a year ago and the 10-year average, both of which are 31%. Heavy rain is forecast for Mississippi, Alabama, and Georgia over the next week, which could slow planting progress. A stronger than expected Chinese CPI number on Monday may have been encouraging for the bulls, as it seemed to suggest that the government’s stimulus measures are boosting Chinese consumer confidence, which could support stronger demand.
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