Cotton Higher Before Export Data

COTTON

December Cotton was higher early Thursday, perhaps buoyed by higher crude oil prices despite softer stock prices and a stronger dollar. Traders will be looking for the export sales report for direction today after last week’s report showed a dismal 34,360 bales for the 2025/26 (current) marketing year and of 4,075 for 2026/27 for a total of 38,435, the lowest combined total since August 1, 2024. World Weather Inc. said west Texas cotton is still struggling with dryness in some areas, but August weather will be THJE determining factor. Production potentials could rise greatly with a few timely rain events, and El Nino could provide such an environment. August weather can either lead to higher production or (in the case of no rain and hot temperatures) result in a notably smaller crop. They also threw some shade on recent reports from China that have suggested that recent extreme heat in Xinjiang has damaged the crops. They said that other than the recent weather, the production year has been quite favorable. India has seen timely rain in some of the northwestern production areas, but the crop also needs rain later this week and into early next week come in as forecast.

COFFEE

September Coffee was lower early Thursday and was back near the lower end of a two-week trading range after USDA on Wednesday released its first complete global forecast the 2026/27 marketing year, which included increases in global production and ending stocks. Some of the data had been released earlier in the year. Cooxupe, Brazil’s largest coffee co-operative, said on Wednesday that  its farmers had harvested 47.3% of their 2026 crop as of July 17 versus 59% a year earlier. Harvest was interrupted by heavy rainfall in June. Indonesia’s harvest was reported to be about 80% complete. Reuters reports that Vietnam’s coffee market was sluggish as they come to the end of the harvest season. Robusta premiums in Indonesia jumped this week on tighter supplies and a potentially smaller harvest.

SUGAR

October Sugar was higher early Thursday but inside this week’s range. Valor International said that if frequent rainfall is brought on by El Nino later this year, it could support strong sugarcane production in Brazil’s Center-South region during the remainder of the 2026/27 season and into the next crop year.  Excessive rain could also hinder harvesting and slow crushing. They added that the recent rains have delayed crushing activity but have not compromised yield potential. Most effects could be felt beginning in September, when warming in the Pacific Ocean starts to have a more pronounced influence on atmospheric circulation over Brazil. El Niño could lower sugar production for Thailand, India, Mexico, and parts of Europe. World Weather Inc. says moisture deficits continue in a large section of Western Europe. France is very dry, and their beet crop has already been impacted by heat and moisture stress. Drier-than-usual weather is slated for much of Western Europe for at least another week, and conditions will continue to deteriorate. There is still some concern over dryness in southern sugarcane areas of India, and this could continue for another couple of weeks. Southern Thailand remains a little too dry and needs greater rain. Brazil will not be threatened by any damaging cold and weather conditions should be dry or mostly dry during much of the next two weeks

COCOA

September Cocoa edged lower early Thursday and fell its lowest level since July 2. The International Cocoa Organization has estimated Indonesian cocoa production to increase to 220,000 metric tons in 2025/26, up from 200,000 in 2024/25. Indonesian cocoa grinding was estimated to reach 420,000 tons, up from 354,000 tons in previous season. Indonesia’s second-quarter grind totaled 110,410 metric tons, up 30% from the first quarter, according to an industry ministry official. Last week’s Asia’s second quarter cocoa grind report came in 25% higher than the same period last year. Transgraph Consulting is forecasting a 80,000-ton global surplus for 2026/27 following a 415,00-ton surplus in 2025/26. Lower production is expected in Ivory Coast, Ecuador and Ghana, and Indonesia.  A Reuters poll of analysts and traders earlier this week forecast a balanced market in 2026/27 after a significant surplus in the current season. World Weather Inc. says Ivory Coast and Ghana will benefit from showers and thunderstorms during the next week.  Rain will be erratic at times, but all of the region will receive at least some rain that will be important when drier weather likely occurs in August. Close watch will need to be kept on rainfall in August and September, when El Nino’s could delay or reduce the amount of seasonal rainfall.

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