ADMIS News
SUGAR
May Sugar tried to work higher early Friday after a modest recovery bounce off a new contract low on Thursday without much success. A report from Reuters that India has approved the export of additional 500,000 metric tons of sugar in the current season is another indication of their strong crop this year. This would bring the quota to 2.0 million tons. There have been limited reports of actual sales so far, with some estimated around 130,000 tons, with sales slow due to low world prices relative to domestic prices in India. The increase in the quota suggests that the global surplus for 2025/26 may be even larger than previously thought. This could also provide a ceiling to any rallies. Already, low sugar prices are expected to reduce investment in cane and beet production in 2026 as well as encourage more ethanol production as opposed to sugar, which will produce a lower surplus in 2026/27. The US Climate Prediction Center on Thursday gave a 60% chance for a transition from La Niña to ENSO-neutral in February-April, and it gave a 56% chance for ENSO-neutral to persist through the Northern Hemisphere summer (June-August). This may ease some concerns that El Niño would emerge this summer to disrupt monsoon rainfall in India and Thailand.
COFFEE
After falling to its lowest level since August this week, May Coffee has staged a recovery rally. The market apparently got oversold on the strong Brazilian crop theme. It also struggle to break into a month-long consolidation from last July was included the low price for 2025. Some forecasts for Brazil’s 2026 coffee production are less bearish than others. World Weather Inc. says showers and thunderstorms are still expected Thursday through all of next week, though the daily distribution is expected to sporadic and mostly light. A report that canephora coffee varieties, including conilon and robusta, are expanding in Brazilian states that traditionally produce little to none of the crops may counter the narrative that robusta is taking over arabica in the Brazilian coffee industry. Robusta production is expanding into non-arabica areas. Brazil now it is the second-largest producer of canephora coffee, second only to Vietnam.
COCOA
May Cocoa was lower early Friday, extending the recent selloff to new contract lows. The nearby contract has fallen to its lowest level since October 2021. News that the Ghanian government has lowered the farmgate cocoa price paid to farmers, in an attempt to align with the international market and spur more demand added to pressure. The question now is whether these lower cash prices will finally induce some buying and support the market. The farmgate price had been nearly $5,300 per metric ton, and the new price will be around $3,580. Ghana’s cabinet has directed Cocobod to begin immediate repayment of all affected cocoa farmers. A new bill will be presented to parliament to link farmgate rates to international prices and guarantee a minimum of 70% of gross FOB price. A coalition of Ghanaian cocoa farmers said it was willing to accept lower prices for future deliveries, provided the government first paid what it owed for beans already delivered at the previous official price.
COTTON
May Cotton turned lower early Friday after first trading to a new high for the week. The market fell to a new contract low one week ago, ahead of this week’s supply/demand report. The report showed a minor, 200,000 bale decline ins US exports for 2025/26, which translated into a 200,000-bale increase in ending stocks. This put the stocks/use ratio at 32.4% versus 30.4% in January and a five-year average of 26.4%. Still short of the 42.7% from 2019/20 but the second highest since 2008/09. Thursday’s Export Sales report showed net cotton sales for the week ending February 5 at 231,031 bales for the 2025/26 (current) marketing year and 50,863 for 2026/27 for a total of 281,894. Total sales were down from 364,720 bales the previous week, and sales for 2025/26 were down from 249,836. Cumulative sales for 2025/26 have reached 8.034 million bales, down from 8.886 million at this time last year and below the five-year average of 10.793 million (and still the lowest since 2015/16). Sales have reached 71% of the USDA forecast versus a five-year average of 87% for this point in the marketing year. Shipments totaled 188,597 bales, down from 235,313 the previous week. The largest buyer was Vietnam at 95,447 bales, followed by Turkey at 45,794. China cancelled 53,147 bales.
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