India’s High Domestic Price Will Limit Sugar Exports

SUGAR

News that the Indian government would allow sugar exports of up to 1.5 million metric tons for 2025/26, which up from 1.0 million last year, did not break the market yesterday. Perhaps because the amount allowed was short of the 2.0 million that Indian processors were requesting. Domestic prices in India are currently above world prices, which will discourage exports in the near term. Last week some traders suggested that Indian domestic prices would reach parity with the world price by early December and more sugar from this year’s production became available. The next UNICA report on Brazilian Center-South sugar production (for the second half of October) could be released this late week or early next.

COTTON

At least the end of the government shutdown will allow cotton traders to get a better idea of how the US crop if faring and how export sales are coming along. There is no indication yet when the weekly Crop Progress and Export Sales reports will resume, but the USDA supply/demand report will be released on Friday, and this will provide the first update since the shutdown began. In the meantime, the market shows occasional glimpses of optimism about exports despite the lack of evidence. China has reportedly committed to buying US soybeans, which leads to hope that they could buy US some cotton as well. On the other hand, Vietnam, Pakistan and Mexico are the leading buyers this year, with China in 12^th place. Prior to the shutdown, the export sale pace was well behind the average needed to meet the USDA’s forecast for the marketing year.

COFFEE

The drawdown in ICE exchange stocks has helped drive coffee prices to new contract highs over the past couple of months. The drawdown was caused by the US tariffs on Brazilian imports which left US roasters scrambling to get supplies. The US Supreme Court heard arguments over the legality of the tariffs last week, and the trade is waiting for a decision. If they decide against the tariffs, it could open up a flood of Brazilian supply. Already we have seen some coffee trickle into ICE warehouses in Europe, but they have not been certified. ICE certified stocks fell another 775 bags yesterday to 416,703, the lowest since March 7, 2024. The amount pending review has reached 27,886, the highest since September 9. Of those, 19,886 were from Brazil. All are located in Antwerp. There are currently 13,976 bags of Brazilian certified stocks in ICE warehouses versus some 435,000 a year ago. Colombia’s washed arabica coffee production totaled 1.208 million bags in October, up from 1.142 million in September but down from 1.339 million in October 2024

COCOA

The cocoa harvest in West Africa appears to be advancing well. The region is experiencing a seasonal dry down but is still seeing some rain. Dry conditions help harvest and drying of beans and also keep the roads clear of mud. There was another strong week of arrival at Ivory Coast ports, but cumulative totals still lag a year ago.  Yesterday’s update showed arrivals totaled 107,000 metric tons for the week ending November 9, up from 90,000 the previous week and a year ago and above the five year average for the week at 98,200. Cumulative arrivals have reached 411,000 tons, down from 455,000 at this point last year and below the five year average of 462,000. The gap between this year and the average is narrowing.

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