COCOA
March Cocoa is trading inside yesterday range-down action this morning. Ivory Coast farmers interviewed by Reuters yesterday said dry Harmattan winds could begin to blow early this season, which could cause a shortage of beans starting in February. The region’s dry season typically runs from mid-November to March. Last week rains were below average in most of Ivory Coast’s main growing regions. The Harmattan (dry winds from the Sahara) usually moves in between December and March, and it can damage pods and dry soils. The longer the Harmattan holds off, the better the chance for the main crop production to extend. Ivory Coast cocoa arrivals totaled 94,000 metric tons for the week ending Sunday, up from 90,000 the previous week and the highest since January 15, 2023. Cumulative arrivals since the marketing year began on October 1 have reached 549,000 tons, up from 417,000 at this point last year. Southern regions of Ivory Coast saw light to moderate rain over the past 24 hours, with the heaviest amount near the coast.
COTTON
March Cotton edged closer to the August 16 contract low at 67.90 overnight. The market continues to feel the pressure of a dismal demand outlook. Brazil Agricultural Minister Carlos Favaro said yesterday that farm agreements with China would be announced Wednesday, ahead of meeting with Chinese President Xi Jinping on the sidelines of the G20 summit in Brazil. This will add to concerns about US export prospects. US harvest progress slowed a little bit last week but was still above the average pace. The weekly Crop Progress report released yesterday afternoon showed 77% of the US cotton crop had been harvested as of November 17, up from 71% the previous week and 74% a year ago. The five-year average for this date is 75%. Texas was 72% harvested, up from 65% last week and ahead of the five-year average of 68%. Georgia was 69% harvested, up from 60% last week and 67% a year ago. It is still behind the average pace of 73%. World Weather Service says rain in the coming week to ten days in Australia’s eastern dryland crop region of New South Wales and Queensland will improve dryland planting, emergence and establishment conditions.
SUGAR
March Sugar is near unchanged this morning after trading to its highest levels since November 7 overnight. The market has seen a four-day rally off a two-month low. Recent rainfall in Brazil has eased concerns about the upcoming crop, but the long hot and dry spell this year and extensive wildfires this past September keep concerns about 2025 production alive. The rains may also slow harvest for the remainder of 2024, which usually winds down in late November or early December. The recent UNICA report showed center south production falling off sharply in the second half of October. Total production since the market year began in April is running about even with a year ago.
COFFEE
March Coffee was near unchanged overnight and spent the session in the lower part of yesterday’s range. The market traded to new contract highs yesterday but closed well off those levels and below Friday’s close, which was a disappointment to the bulls. Safras and Marcado said yesterday that Brazilian coffee sales for 2024/25 reached 70% of the total harvested this year, an increase of 8 percentage points from last month. This is up from 64% this time a year ago and a five year average of 67%. World Weather Service reports horrific flooding occurred late last week and into the weekend across northern Honduras, including some coffee production areas. The impact on trees and cherries should have been relatively low, but access into those areas may be limited for a while. Most of Brazil’s coffee areas will get additional rain periodically through the next two weeks, although Parana and southwestern Sao Paulo may experience net drying. The condition of the 2025 crop is still up for grabs. Rains came in time to produce good flowering, but there is some question whether the trees have enough energy to produce a strong crop after the severe drought earlier this year. One cash broker noted strong branch growth but not enough cherries.
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