COFFEE
March Coffee was lower overnight, even managing to take out support at the December 13 low. World Weather Service says La Niña-like conditions are prevailing around the world and the influence on coffee areas is becoming more notable. Recent rainfall has been abundant in Indonesia and it will likely remain that way. Rainfall has also been abundant in Brazil coffee areas that, too, will not be changing any time soon. Some greater than usual rainfall has been noted this season in parts of Vietnam, the greater Antilles, Mexico and Central America mostly because of developing La Niña conditions. The anomalously wet bias in Central America is expected to prevail for the next couple of weeks and so might the heavier rainfall of Brazil and Indonesia. The increased rainfall for Brazil is probably good news for the 2025 crop despite concerns that the drought earlier this year has already caused damage that could be irreversible. WWS says sufficient amounts of rain and seasonable temperatures are expected to promote a very good outlook for cherry and tree development. An overabundance of rain in Vietnam during harvest is a concern. Indonesia’s Sumatra robusta coffee been exports totaled 22.9 million metric tons in November, down from 31.9 million in October but up from 13.0 million for the same period last year. Uganda’s coffee exports were down 6% from a year ago in November, as the crop was hurt by poor flowering at early stages.
COCOA
March Cocoa extended Monday’s recovery rally overnight and as now retraced more than 61.8% of the selloff from the December 18 high. World Weather Service expects very little change from the current pattern of warm and dry weather in West Africa. They say Harmattan wind speeds should be near average, but the low humidity, abundant sunshine and wind will stress some trees. They added that these conditions are unlikely to harm development potential later in 2025 unless they persist longer than usual. Farmers interviewed by Reuters said yesterday no rain fell last week in most of Ivory Coast’s main cocoa growing regions and that the dry weather could damage bean quality and tighten supply from February. They also complained of hot weather. Ivory Coast Cocoa arrivals since the marketing year began have reached 1.054 million tons, up from 827,000 a year ago but below the five-year average of 1.071 million.
COTTON
March Cotton continues to trade in a narrow range near contract lows. Buyers seem to emerge when the market makes a new contract low and then fade away on subsequent rallies. The dollar is holding near its highest level since November 2022, which makes US cotton less competitive on the global market. China has approved five gene-edited crop varieties and 12 tyles of genetically modified (GM) crops, including cotton, to boost yields and reduce import reliance. This follows a strong cotton crop this year that has limited their import demand. World Weather Service says eastern Australia is expecting a return of showers and thunderstorms in many production areas, including cotton, during the next two weeks. Recent crop stress slowed dryland crop development, but this change will restore a very good outlook.
SUGAR
March Sugar’s brief recovery rally yesterday ended with a new low for the move. The strong rainy season in Brazil has improved the outlook for 2025 cane production, and the UNICA data last week at best confirmed an expected seasonal decline in production for the first half of December. Argentina and far southern Brazil may be dry, but Center South is still seeing good moisture. Brazil’s San Martinho it had crushed 21.8 million metric tons of sugarcane from the 2024/25 crop, down 1.7% from the previous season but that sugar production rose by 0.75 to 1.329 million tons.
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