ADMIS News
SUGAR
March Sugar was slightly higher overnight but inside yesterday’s range. The market may be trying to establish a low following a 13-cent decline from a the November 2023 12-year high, but technical bulls have likely been disappointed with the market’s drift lower. Expectations for strong crops out of India and Thailand this year and a recovery of Brazilian output this summer suggest ample supply. The next UNICA report on Brazilian center south production should come next week. Demand expectations are declining, especially with the increasing popularity of weight loss drugs. Increased crude oil production by OPEC+ limits ethanol demand, which leaves more cane available for sugar. On top of that, Brazil is focusing more on corn as a feedstock, and there were reports this week that India was as well. The Agriculture Ministry in China kept its forecast for 2025/26 sugar imports at 5 million tons. Europe’s largest sugar producer, Suedzucker said its second quarter operating profit was down 82% from last year due to lower prices.
COCOA
March Cocoa fell to its lowest level since November 11 this morning, as the market continues to work lower on reports of strong crops in west Africa. Ivory Coast and Ghana recently increased the official prices paid to farmers, and this is believed to be encouraging arrivals from the bush. Seasonal rainfall last month was viewed as beneficial for the crop, and there have been relatively few reports of disease problems. Farmer interviews were very upbeat about production prosects. World Weather Inc. expects sufficient rain in west Africa during the next week to maintain a favorable environment for crop development. The entire production region from Ivory Coast to Cameroon and Nigeria will be impacted.
COFFEE
December Coffee has been chopping around inside a two-week range. Rains appear to be gradually increasing in Brazil, which are needed to get the 2026/26 crop flowered and harvested. The “friendly call” this week between President Trump Brazilian President Lula da Sliva has raised hopes that the 50% US tariffs on Brazilian goods may be lifted. In an interview with a local radio station the Brazilian President said he was surprised about the outcome of the talk, at which we requested the removal of tariffs on Brazilian exports to the US. There are also reports that Brazil’s Foreign Affairs Minister and US Secretary of State Rubio are planning a meeting in Washington following a phone conversation they had yesterday. Brazilian exports have suffered a setback due to the tariffs. The exporters group Cecafe reported that the nation shipped 3.45 million bags of green coffee in September, down 18% from a year ago. Arabica bean exports totaled 2.97 million bags, down 10%, and robusta exports totaled 489,700 bags, down 47%. Total coffee exports to the US (including green and industrialized coffee) totaled 333,000 bags, down 53% from a year earlier. World Weather Inc says rain in Sul de Minas and northeastern Sao Paulo yesterday and today should be sufficient to induce some new flowering and to stimulate some pollination of early flowered crops and that more rain is expected into the middle of next week.
COTTON
December Cotton fell off sharply overnight to new contract lows on what appears to be harvest pressure and a lack of sales. With no Crop Progress or Export Sales reports this week, the best traders have for guidance is the conditions reflected in the most recent reports, which showed US cotton crop conditions were above average (and very strong in Texas) and that US export sales were very slow. The monthly WASDE report was also postponed. Analysts surveyed by Bloomberg suggested the expect little change from the August report. World Weather Inc. expects a few showers and thunderstorms for in west Texas Monday and Tuesday, which could slow crop maturation and raise a little concern about quality, but the rains are not expected to last very long or be very heavy. Delta and southeastern crops are expected to see a restricted rainfall pattern over the next week to ten days that should support crop maturation and some harvest progress. Xinjiang, China crops are rated favorably, and good harvest progress is suspected. World Weather Inc. said weather conditions suggest strong production out of that region this year. This should limit their import needs, even if they were interested in buying from the US. Heavy rains and flooding in Pakistan could make them more aggressive buyers, but that also depends on the strength of their textile exports. Pakistan is the second largest buyer of US cotton so far for the 2025/26 marketing year.
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