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West African Farmers Wait for Rain


The cocoa market is seeing choppy action around its recent highs, as west African growers continue to fret over the weather. Another week of low rainfall and high temperatures is expected across most of Ivory Coast’s main growing areas. They are at the start of their rainy season, and farmers are waiting for heavy rain to offset the impact of hot weather on soil moisture. Farmers said bean quality and availability could improve from mid-May if rains become more regular over the coming week. Ivory Coast port arrivals totaled 3,000 tonnes for the week ending April 7, down from 21,000 for the same week a year ago. Total arrivals since the start of the marketing year on October 1 have reached 1.304 million tonnes, down 27.4% from the same period in 2023/24. Ivory Coast announced a 50% hike to their minimum farmgate purchase price last week and Ghana announced a 58% increase this week, and it was hoped that this would reduce smuggling and attract more supplies to port, but there is already grumbling that these increases are inadequate compared to the 170% increase global prices since October 1.


After increasing 13% in six sessions, July coffee saw some back and fill yesterday and could be in for some more choppy action this week. The International Coffee Organization said that world coffee exports totaled 11.33 million bags in February, up 6.8% from a year ago. Arabica exports were up 16.9% from a year ago, and robusta were down 4.9%. The increase in Arabica exports was attributed to reduced congestion in Brazilian ports.


The cotton market is technically oversold, and traders may be reluctant to push much lower ahead of the USDA supply demand report on Thursday. For the report, a Bloomberg survey shows an average trade expectation for US 2023/24 ending stocks of 2.56 million bales, which would be up from 2.50 million in the March update but down from 4.25 million in 2022/23. The weekly crop progress report showed 5% of the US cotton crop was planted as of April 7, up 2% from the previous week, steady with a year ago, and below the 10-year average of 6%. Heavy rainfall is expected in the Delta this week, which could result in some flooding and delay planting. Overall soil moisture in US cotton areas is much better than it was last year. ICE exchange stocks reached 112,054 bales on Monday, up 18,730 on Friday and the highest they have been since July 2021.


A report overnight that the Indian government is considering a proposal to use an additional 800,000 tonnes of sugar for biofuel this year may support the sugar market today, as this would reduce the chance that the government would allow an increase in exports. The report was from an unnamed source familiar with the matter but was not confirmed. This report comes as recent improvements in production forecasts have sparked speculation that the Indian government would lift its ban on exports. A rebound in Thailand’s sugar production since the start of this year has also been a source of pressure on the market recently.


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