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New All-Time Highs for Robusta Coffee


July NY coffee extended its rally overnight to trade to its highest level since December 2021, and London robusta coffee reached new all-time highs. The robusta rally is being driven by concerns about Vietnam’s upcoming 2024/25 production due to hot and dry conditions there, and this is lending carryover support to the NY arabica futures. A lower crop in Vietnam this year would add to an already tight global supply situation. Their 2023/24 crop was down an estimated 20% from 2022/23. Lower than average rainfall over Brazil’s major Arabica growing regions last week could have a negative impact on their upcoming crop. This comes after a heavy rain event last month that was reported to have damaged trees.

pile of coffee beans


July cocoa saw choppy action overnight after posting new contract highs yesterday. Ivory Coast’s center-west region of Daloa reported above-average rains last week, but farmers in other regions complained about a lack of rainfall. Some farmers said small pods were drying out on trees, but the situation was not alarming yet. They need regular and abundant rains through June. European and North American grindings data is due out on Thursday, and the numbers are expected to be down from last year due to tight bean supplies. Ivory Coast weekly port arrivals last week were less than half of a year ago, which could be an indication of the poor crop conditions, but it could also reflect and farmer frustration with the current official price. Over the weekend, an Ivory Coast producer trade group asked their government to raise the minimum farmgate purchase price from the current 1,500 West African francs (roughly $2.50) per kilo to 2,500. This would be a 150% increase from the original 2023/24 farmgate price of 1,000. Several Ivory Coast political parties have indicated their support for the price hike. The low price and the possibility of an increase may be discouraging farmers from marketing their output.


July cotton has fallen to the top of a two-month consolidation range, bound by 83.69 and 79.65, and this area may act as key. The fundamentals are pointing negative, but the market has already fallen 18% from its February high. The weekly Crop Progress report showed 8% of the US cotton crop was planted as of April 14, up from 5% the previous week and on par with 7% a year ago and a 10-year average of 8%. Plantings proceeding at an average pace and soil moisture levels much improved over last year present little concern for the upcoming crop. The dollar was up sharply over the past week, and the nearby Dollar Index reached its highest level since October overnight, which does not bode well for US export prospects. Southern Hemisphere crops are becoming available. Uncertainty over how Israel will respond to Iran’s attacks over the weekend could keep the stock market on edge, and this could have a spillover effect on the cotton market.


July sugar fell to its lowest level in a year overnight, extending yesterday’s selloff that came after the India Meteorological Department forecast this year’s monsoon rainfall to be 106% of their long-period average. This would be slightly above the range for “normal” monsoon rainfall (96% to 104%) and is in sharp contrast to last year’s actual rainfall that was 94.4% of the average. This was also the first time in eight years that the IMD called for above average rain in their initial forecast. A pullback in crude oil as Middle East concerns eased put additional pressure on sugar on ideas this lowers the incentive for mills to crush cane for ethanol. The market is still on edge as it awaits Israel’s response to Iran’s attack over the weekend. And a steep pullback in the Brazilian real to its lowest level in six months also weighed on sugar yesterday on ideas it would incentivize exports.


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