ADMIS News
COCOA
December Cocoa was higher overnight, trading to its highest level since August 27 following last week’s reversal from a two-month low. The market has been trading in a relatively narrow range since the end of June as it waits for the main crop to come in later this month. West African weather has been mostly favorable this summer, but a dry spell in key southern Ivory Coast and southern Ghana, in their main cocoa growing regions, have occasionally lent support. This has been offset by farmer reports that the crops are developing well in Ivory Coast. World Weather Service reports those regions are struggling to get good solid rainfall, and precipitation looks to continue to be light over the near term. They expect the rain pattern to slowly change in the next ten days with heavier rainfall moving southward. Friday’s Commitments of Traders Report showed managed money traders were net sellers of 942 contracts of cocoa for the week ending September 3, reducing their net long to 27,101.
COFFEE
December NY Coffee was higher overnight following Friday’s steep selloff, which came in the wake of the International Coffee Organization reporting that as of July 31, global green coffee exports for the 2023/24 season (October-September) were up 10.6% from the same period last year. Also, Brazil exported 207,071 metric tons of green coffee in August, up from 197,471 for the same period a year ago. World Weather Service expects dry and very warm weather to continue in Minas Gerais, Brazil for at least the next ten days. Over the weekend Typhoon Yagi came ashore in northern Vietnam and brought flooding rain and windy conditions to Arabica coffee areas which could have resulted in some cherries dropping from trees. More flooding rain is likely early this week. The main robusta areas in the Central Highlands have been spared. Brazil has some time before rainfall is critical for the upcoming crop. Friday’s Commitments of Traders Report showed managed money traders were net sellers of 2,809 contracts of coffee for the week ending September 3, reducing their net long to 56,200. This is down from the record net long of 71,811 from April, but it is still near the upper end of the historic range, which leaves the market vulnerable to heavy selling. ICE arbacia stocks were up 9,055 bags on Friday to 843,847, the highest since August 30.
COTTON
December Cotton near unchanged overnight following a steep selloff on Friday to its lowest level since August 19. Demand is a major concern, and the market felt pressure on Friday off negative market sentiment in equities and crude oil. The US dollar reversed and closed higher on Friday after falling to its lowest level since August 28, and it extended its rally overnight, which sparks concerns about US competitiveness in the global export market. The weather leans bullish today with potential for heavy rain in the Delta and more rain expected in the Southeastern US.
The weekly export sales report on Friday showed US cotton export sales for the week ending August 29 were the highest for the marketing year so far, with net sales of 207,512 bales for the 2024/25 (current) marketing year and 8,367 for 2025/26 for a total of 215,879. This was up from 135,891 the previous week and the highest since July 25. Cumulative sales for 2024/25 have reached 4.648 million bales, down from 5.312 million at this time last year and below the five-year average of 6.910 million. Sales have reached 33% of the USDA forecast versus a five-year average of 53% for this point in the marketing year. The largest buyer was Pakistan at 71,404 bales, followed by India at 41,765, Turkey at 22,666, and Costa Rica at 20,046. Pakistan has the most commitments for 2024/25 at 959,100 bales, followed by Mexico at 538,700, China at 488,200, and Turkey at 424,800.
Friday’s Commitments of Traders Report showed managed money traders were net buyers of 2,643 contracts of cotton for the week ending September 3, reducing their net short to 42,665. This is not much above the record net short of 51,845 from August 20, which leaves the market vulnerable to short covering.
SUGAR
October Sugar was slightly lower overnight, extending Friday’s steep selloff. The market reversed lower on Friday after failing to take out Monday’s highs. Reports of some rain reaching sugar growing areas of Brazil may have contributed to the selling. Low rainfall earlier this year has been expected to bring an early end to Brazil’s production season, and the last few bi-weekly UNICA reports have shown production trending lower. On Friday it was confirmed that India plans to extend its sugar export ban into upcoming marketing year as it works to expand its ethanol industry. Friday’s Commitments of Traders Report showed managed money traders were net buyers of 28,626 contracts of sugar for the week ending September 3, increasing their net long to 44,001.
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