ADMIS News
COFFEE
March NY Coffee was higher early Tuesday after the market held above the September low in Monday’s trading. The market closed back above the 200-day moving average on Monday after closing below that line for the previous two sessions, and that lent some technical support. Reuters reported yesterday that a Vietnam-based dealer said farmers were balking at price bids from traders and that some have already bought back supplies. London prices saw decent gains on Monday and Tuesday, which also suggests traders have rejected lower prices for now. Indonesia’s chief negotiator said that Indonesia and the US have agreed on all substantial issues for a tariff deal, paving the way for the signing of an agreement at the end of January. The United States wanted access to Indonesia’s critical minerals and had agreed to give tariff exemptions to its palm oil, tea and coffee. While the US is not the biggest robusta consumer, this agreement would open the door for more purchases.
SUGAR
March Sugar was higher early Tuesday, managing to inch above Monday’s high. The market has seen a three-day bounce and is threatening to kay out a quasi-double-top at 15.27 and 15.29, which is the high of the range of the past two months. Safras & Mercado said on Monday that it expects Brazil center-south region sugar production to reach 38 million metric tons in the 2026/27 season, which would be down 5% from the 2025/26. They expect cane crushing to increase slightly to 600 million tons from 595 million in 2025/26, but they also expect mills to allocate 47% of their cane to sugar production, down from 49% in 2025/26, as demand for ethanol is expected to grow. We have already seen a dramatic reduction in sugar’s share of crushing this fall as low sugar prices have encouraged processors to boost ethanol’s share. Higher crude oil prices this week improve the attractiveness of ethanol production. For the moment, the trade is less concerned about the prospect for higher Indian sugar exports in 2025/26. The nearby Brazilian real has fallen to its lowest level since July this week, and it fell below the 50-week moving average for the first time since April. The weak real makes encourages Brazilian exports.
COCOA
March Cocoa was near unchanged early Tuesday and inside the range of the previous five sessions. The market is weighing a generally positive weather outlook for west Africa against a drop in Ivory Coast port arrivals last week. Ivory Coast farmers told Reuters yesterday that the unseasonably heavy rainfall and wet weather last week should boost the size and quality of the main crop. The region is in its dry season, which runs from mid-November to March, and the moderate rainfall since the beginning of December has boosted crop production ideas for later in the season. It also help trees gird for the Harmattan wind that can dry things out quickly and damage crop prospects. As reported yesterday, Ivory Coast port arrivals totaled 74,000 metric tons for the week ending December 21, down from 91,000 the previous week and 77,000 for the same week a year ago. This was the first time they had been below year ago levels since October 26. Cumulative arrivals since the marketing year began on October 1 have reached 968,000 tons, down from 972,000 a year ago but up from 747,000 in 2023/24. World Weather Inc. expects a restricted rainfall pattern in west African growing regions through the next week. Bloomberg cited the expectation for index-related buying in the New Year with the inclusion of cocoa in the Bloomberg Commodity Index as lending support. Citigroup Inc. has projected that the rebalancing will lure as much as $2 billion of buying in the first days of January.
COTTON
March Cotton was higher early Tuesday but inside Monday’s range. Traders may be cautious ahead of the next export sales report, which is due to be released today. Monday’s report was not particularly strong, but the market has drawn support from higher crude oil prices, which makes polyester more expensive, and from a weaker dollar, which helps make US cotton more competitive on global market. The dollar was down early Tuesday, with the March Dollar Index threatening to take out last Tuesday’s two-month low, and crude oil was holding the previous day’s gains.
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