Brazil Harvest Pace Ahead of Average

COFFEE

September Coffee was higher overnight but inside Friday’s range. The Brazilian harvest pace seems to be catching up with last year, but there is still a great deal of uncertainty with the US/Brazil tariff situation. Safras & Mercado reported on Friday that Brazil’s 2025/26 coffee harvest had reached 84% of the planted area as of July 23, up from 81% a year earlier and above the five-year average of 77% for this time of year. The robusta harvest was 96% completed versus 95% a year ago and a five-year average of 93%, and the arabica harvest was 76% complete versus 75% a year ago and 69% on average. The weather maps indicate southern Minas Gerais saw some rains over the weekend, which could slow harvest for a time, but dry weather is expected to return. World Weather Service said Rainfall varied from 1 to 9 millimeters in Sul de Minas and up to 19 millimeters in southern Zona da Mata and in northeastern Sao Paulo. Most other coffee areas were dry. Mild temperatures are expected, with limited rainfall. Below normal rainfall is expected in coffee production areas of Vietnam during the next week to ten days. Some rain is likely, but amounts will be light and daily coverage low. Many of the production areas in the Central Highlands will get rain at one time or another. Uganda’s Agriculture Ministry said coffee export volumes were up sharply in June and was above a year ago. They are Africa’s largest coffee exporter, followed by Ethiopia, and they primarily cultivates robusta. BMI is calling for a 5.2% increase in Vietnam’s 2025/26 crop based on good weather.

COTTON

December Cotton was mixed overnight, perhaps drawing support from equity market gains in the wake of the US/EU trade announcement but then seeing some pressure as the US dollar rallied off the news. The EU deal is not specifically bullish for cotton,  as the US sells little cotton to Europe, but a more positive economic outlook is beneficial to cotton consumption in general. The negotiations with China will carry more weight, and there are hopes that the August 12 deadline will be extended when Treasury Secretary Bessent meets with the Chinese Vice Premier in Stockholm this week. The US crop looks good. Last Monday’s Crop Progress report showed 57% of the US cotton crop was rated good/excellent as of July 20, versus 53% a year ago and a five-year average of 48%. Texas was 52% G/E versus 44% a year ago and a five-year average is 34%, and we see little reason for a significant change in the outlook. World Weather Service did say that west Texas cotton areas still need greater rain and some additional warm weather to support the best dryland production. Other areas in Texas are seeing highly varying weather and soil conditions. The 6-10 and 8-14 day forecasts show above normal temperatures and normal to above normal rainfall across most of the US growing areas.

SUGAR

October Sugar was slightly higher overnight but was inside the range of the previous two sessions. Prices having fallen to their lowest level in over two years has apparently drawn some cash buying interest. European traders told Reuters on Friday that Pakistan’s state agency, the Trading Corporation of Pakistan (TCP) has issued an international tender to purchase 100,000 metric tons of white refined sugar. On July 8 the government approved plans to import 500,000 tons of sugar to help to maintain price stability. Dry conditions in Brazil this month have traders expecting the nation’s sugar production to show a recovery this month after the slow progress in June. The UNICA report on production for the first half of July is expected to be released this week. The last report showed Brazil center-south production for the second half of June was down 13% from a year ago, with cumulative production down 14%. Production tends to peak for the year in the second half of July. There could be a bit of a slowdown due to rain over the weekend. World Weather Service says Central Thailand soil moisture is improving, but was still running short to very short at the end of last week.

COCOA

The 2024/25 Ivory Coast crop seems to be getting smaller on subsequent revisions, but current conditions seem ripe for a strong crop main crop this fall. Ivory Coast port arrivals totaled 13,000 metric tons last week, according to exporters’ estimates. This brings cumulative arrivals for the 2024/25 marketing year to 1.620 million tons, down 2% from 1.655 million at this point last year. The exporters revised their estimates down after the Ivory Coast Coffee and Cocoa Council (CCC) said on July 23 that official arrivals had reached only 1.579 million tons as of June 30 versus 1.613 million from the exporters’ estimated. The revised number puts the cumulative total behind 2023/24 for this first time since the marketing year began in October. Last week, small growers in Ivory Coast were fretting that they could be forced out of business due to the cost of complying with new EU regulations on the import of commodities linked to deforestation. However, as of last week the CCC indicated that 90% of growers had already had taken necessary steps to comply. The deadline for compliance is December. World Weather Service says most of Ivory and Ghana cocoa areas were dry over the weekend, with some rain seen from southeastern and central Nigeria crop areas into western Cameroon and moderate to heavy amounts in some areas and possible flooding in a spot or two. Very little change is expected over next ten days. Seasonal rains have shifted north of the key cocoa production areas in Ghana and Ivory Coast, which is normal for late July. This trend will continue through the first half of August allowing some harvest progress to advance and the soil to firm up. Seasonal rains should return again in mid- to late-August

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