ADMIS News
COCOA
May Cocoa continues to chop around near recent lows but is managing to hold above the 200-day moving average. The Ivory Coast Coffee and Cocoa Council (CCC) is expected to increase the official farmgate price by at least 11% to roughly $3350-$3850 per ton. Officials with the council acknowledged that Ivory Coast was about to see its worst mid-crop output in the last 10 years due to an unusually long dry season. This follows estimates from exporters and pod counters this week which also presented a dismal outlook for the crop. Apparently the rains that started falling at the end of February were not sufficient to change course. The CCC has reserved the mid-crop harvest for locally based grinders, but unlike last year, they do not expect any export cancellations in 2024/25. World Weather Service says most of West Africa will see some periodic showers and thunderstorms during the next week, but warm temperatures are keeping evaporation rates high. ICE certified cocoa stocks increased 11,520 bags yesterday to 1.770 million, their highest since October 30. Stocks have increased for 10 straight sessions and are up 355,619 since March 5
Steadily increasing exchange stocks and the claim that Ivory Coast will not have to cancel export contracts this year despite a dismal outlook is on offset to low mid-crop expectations.
COFFEE
On the whole, the coffee market continues to derive support from a lack of rain in Brail. World Weather Service says that rain events are coming a little more frequent, but daily amounts are still lighter than usual. They expect this trend to continue through much of next week. This may prevent the needed buildup of soil moisture, but it may at least be enough rain to avoid further a declines in crop conditions. Coffee prices firmed a bit in Vietnam, with farmers apparently reluctant to sell their remaining supply. ICE certified arabica stocks fell 4,961 bags yesterday to 782,648, their lowest since February 20. They are down 19,629 in the last four sessions.
COTTON
May Cotton is slightly higher this morning as the market awaits the weekly export sales report. Last week’s report showed net sales of 381,990 (old and new crop combined) for the week ending March 6, which was the highest since January 16, and another strong report this week would likely be greeted favorably. Another strong shipments number could also lend support. Last week’s 403,461 bales were the highest for the marketing year so far. The dollar is higher today after falling to its lowest level since October on Tuesday, which undercuts some of the support for cotton. The weekly drought monitor will be released today. Last week’s update showed 33% of US production was in an area experiencing drought, which was an improvement over 38% from the previous week. Texas needs rain ahead of planting, and the 6-10 and 8-14 day forecasts show normal chances of rain in west Texas and above normal further south, an area where the need is most urgent.
SUGAR
May Sugar has once again run up against resistance around the 20-cent level, and heavy consolidation up to 21 cents could take some time to work through. Recent scattered showers in Center-South Brazil have improved the 2025 production outlook somewhat, but more rains are likely needed. The new crop year begins next month. Brazilian crushers may also have an increased incentive to produce ethanol. The Brazilian real has reached its highest level since October this week, which lowers the incentive to produce sugar for export. Ukraine’s deputy farm minister said they expected the 2025 sugar beet to come in around 250,000 hectares, close to last year’s 253,000. Last month, the head of the national sugar union said the area could fall to 230,000 hectares, mostly because of drought. Three sources told Reuters that the European Commission is looking to cut Ukrainian sugar imports sharply after EU producers complained that large shipments had fueled a collapse in prices.
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