US Cotton Export Sales in Focus

COTTON

Traders are looking to today’s export sales report, which will cover the week ending December 18, to see if it can come close to the previous report, which was above 300,000 bales for only the second time this marketing year. That report put US cotton sales for the week ending December 11 at 304,689 bales for the 2025/26 (current) marketing year and 14,960 for 2026/27 for a total of 319,649. Cumulative sales for 2025/26 are still running well behind average at 6.183 million bales versus 7.012 million at this time last year and a five-year average of 8.888 million. They are the lowest in 11 years. Sales have reached 55% of the USDA forecast versus a five-year average of 71% for this point in the marketing year, which suggests the USDA could lower its export forecast in upcoming WASDE reports unless export sales start to pick up steam.

COFFEE

March Coffee was near unchanged early Wednesday after backing off from a rally on Tuesday. Rain in Brazil is beneficial for the 2026/17 crop, and dry conditions in Vietnam are conducive to harvest, but excess moisture in Indonesia is raising concerns for their (mostly robusta) crop. World Weather Inc. reported that in Brazil, showers and thunderstorms are likely through the coming week and all coffee production areas will be impacted at one time or another. In Vietnam, a limited amount of moisture is anticipated for the next week to 10 days. Some minor disruptions to farming activity should occur for very brief periods of time, and the environment will remain favorable for good harvest progress. In Indonesia, an active weather pattern will continue in coffee areas through the next week to 10 days. All production areas will be impacted by multiple rounds of rain that will be light to moderate most often with some heavier amounts expected periodically. The ground is saturated with moisture in much of the coffee region and that will maintain some risk of flooding over the forecast period. ICE certified arabica stocks fell 750 bags on Tuesday to 455,727. This was the first daily decline in more than two weeks.

SUGAR

March Sugar was higher early Wednesday but inside Tuesday’s range. The market sold off on Tuesday on what appeared to be a technical move, and it found support in both sessions at the 50-day moving average. The market is facing a large global surplus this year, but after falling to its lowest level since 2020, it may have taken most of that into account. Low sugar prices have apparently encouraged cane processors to focus more of their crushing activity towards ethanol production. By November, the funds were close to a record net short position, which left the market vulnerable to short covering. The last COT report still showed managed money traders were net short 166,702 contract as of December 16, reduced from 205,988 in November but still substantial. The next UNICA update for Center-South Brazil cane crush and sugar production (covering the first half of December) could be released this week or next. The last report showed that cumulative production for 2025/26 was running about 1.1% above a year ago. Sugar’s share of crush for the second half of November was 35.5% versus 44.6% for the same period in 2024.

COCOA

March Cocoa was near unchanged early Wednesday and in the center of Tuesday’s wide range. Monday’s rally off the low Ivory Coast port arrivals last week has stalled, as traders are not certain that the slowdown in arrivals the past couple of weeks is an indicator that this year’s crop will be a disappointment or that the slowdown is a temporary setback due to better than normal rains during the dry season. Ivory Coast farmers interviewed by Reuters are upbeat about production prospects later this season due to good moisture. World Weather Inc. says not much rain fell Monday or Tuesday, which should result in net drying conditions in most cocoa production areas. They expect additional showers and thunderstorms over the next week to ten days from southern parts of Ivory Coast into southern Benin and a few southern Nigeria locations as well as southwestern Cameroon. Most of the precipitation will be infrequent and light with coastal areas from Benin to Ivory Coast most impacted.  There will be some rain farther to the north in Ivory Coast and Ghana this weekend into early next week resulting in some temporary boost in topsoil moisture and possibly a little delay to harvesting of coffee and cocoa.

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