Indonesia Cuts Sugar Imports

SUGAR

March Sugar was lower early Tuesday but inside Monday’s range. The market found support off contract lows in in early November as Brazil cane crushers started to focus more on ethanol production after the market had gotten oversold on expectations of a large global surplus for 2025/26. A strong monsoon this year has boosted expectations for Thailand and India, with India is expected to be an active exporter as a result. They have put their export quota at 1.5 million metric tons for 2025/26, up from 1.0 million 2024/25 and 0 in 2023/24. Indonesia announced it is planning to import around 3.1 million metric tons of sugar for industrial use in 2026  with an additional quota of 508,360 tons of sugar for industries that export their products. In 2025 Indonesia had planned to issue a total import quota of 4.39 million tons for raw sugar but halted the release of import permits in September after sugarcane farmers complained they were struggling to compete with foreign suppliers and ended up only releasing 4.19 million tons worth of quotas. World Weather Inc. says bitter cold air will cover most of the eastern US over the next few days, with frost and freezes likely as far south as southern Louisiana northern Florida Wednesday morning. However, they do not expect enough damage to sugarcane and citrus to change production potentials.

COCOA

March Cocoa was lower early Tuesday, giving back a good portion of Monday’s gains but still inside that day’s range. News on Monday that Ivory Coast cocoa arrivals fell to just 60,000 metric tons for the week ending December 28, down from 74,000 the previous week and 82,000 at this point last year, supported a breakout rally to the highest level since December 12. The arrivals total was the lowest since October 12. Cumulative arrivals have reached 1.020 million tons, down from 1.054 million at this point last year (-2.5%) and below the five year average for this date at 1.068 million. It’s possible that the slowdown in arrivals is the result of above normal rains during what is normally their dry season, which interrupted harvest and drying but benefited production later in the season. Ivory Coast farmers interviewed by Reuters on Monday said that the light rains that swept through much of Ivory Coast’s main cocoa-growing regions last week improved prospects for the last stage of the October-to-March main crop. They said that there were “plenty” of small pods on cocoa trees that were thriving under favorable growing conditions. Ivory Coast is in its dry season which runs officially from mid-November to March, and so far there has been little or no talk of damage from the Harmattan wind  that comes down from the Sahara at this time of year. ICE cocoa stocks increased by 1,176 bags on Monday to 1.627 million after falling to their lowest level since March 12 on Friday. World Weather Inc. says showers and thunderstorms are expected over the next week to ten days from southern parts of Ivory Coast into southern Benin and a few southern Nigeria locations as well as southwestern Cameroon. Most of the precipitation will be infrequent and light. Some rain farther to the north in Ivory Coast and Ghana this week could bring a temporary boost in topsoil moisture and possibly a little delay to harvesting.

COTTON

March Cotton pushed up against the 50-day moving average for the third straight session early Tuesday, as the market is finding support from a recent improvement in US export sales reportage an perhaps some short covering from a very large net short position held by the funds. A stronger bias in crude oil prices this week also lends support on ideas this make man-made fibers more expensive. The next export sales report will be released on Wednesday, December 31, and it will cover the week ending December 18. Last Monday’s report showed US cotton sales for the week ending December 11 at 304,689 bales for the 2025/26 (current) marketing year and 14,960 for 2026/27 for a total of 319,649. This was up from 153,606 the previous week and was the strongest since November 6. It was also the second time above 300,000 this marketing year.

COFFEE

March Coffee extended its recovery rally early Tuesday, trading to its highest level since December 16. The London robusta market was also higher, reaching its highest level since December 12. Brazil is turning wet again after a dry period last week, but key robusta growing areas southeast Asia have been dealing with much rain recently, with Indonesia under a flood threat, and it is possible that the London market is leading NY higher. World Weather Inc. expects frequent rain in Brazilian arabica areas over the next week to ten days, bringing sufficient moisture to maintain a good long term outlook for cherry development. Indonesia will experience frequent rain during the next ten days that will include potential for local flooding in coffee growing areas. Vietnam is drier with occasional rains expected to cause minor disruptions to harvest. The buildup in ICE certified arabica stocks has come to a halt over the past few sessions, perhaps because the holidays.

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