COCOA
March Cocoa is higher this morning but inside yesterday’s-range up day. Yesterday the market traded to its highest level since April 26 and nearly closed a gap from the open on that day. The market has broken out above a long consolidation range this week after unofficial reports that the Ivory Coast Coffee and Cocoa Council out had reduced its sales of cocoa export contracts for the 2024/25 season by 40%. The cocoa market has been counting on a strong west African main crop to alleviate three straight years of global production deficits. A period of heavier than normal rainfall in October has raised concerns about production prospects in the weeks ahead. Last week, dealers and imports were reporting that some of the beans arriving had been damaged by fungal disease, and there were reports of pod damage and slow growth due to the rain. The CCC may also be acting out of an abundance of caution after being caught short-bought last year. Ivory Coast farmers for the most part have been reporting good growing conditions and have been optimistic about their crop going forward. Ivory Coast arrivals so far for 2024/25 have been well above a year ago and the strongest in at least five years. However, traders worry that arrivals could drop off suddenly in December.
COFFEE
March Coffee traded to new contract highs overnight. It seems to be caught up in a post-election buying trends in several commodities, but a trend of declining open interest does not support that idea. A report earlier this week of record Brazilian coffee exports for October may have supported the buying trend on ideas that it indicates strong demand and the slow Vietnamese robusta harvest. London robusta prices are higher this morning, but they are well short of their contract highs from September. One would think the strong dollar (and weaker Brazilian real) would induce more selling by Brazil, but that is not showing up in the price moves. The real reversed lower yesterday after a brief recovery rally, and if it follows through, it could leave its November 1 contract low in jeopardy. Recent storms have slowed harvest progress in Vietnam as several Typhoons have brought ample rain to the Central Highlands. No severe damage has been reported. This week, cash market traders interviewed by Reuters said farmers were speeding up the cherry-picking process. Recent rainfall in Brazil has allowed for abundant flowering for 2025 production, but the severe drought this year may have left trees lacking the energy to produce a strong crop. Minas Gerais saw wide coverage of amply rain over the last 24 hours following a dry spell earlier this week. Sufficient rain is expected to support most crop needs. Temperatures will continue seasonable. A tropical disturbance in the Caribbean Sea could threatened Honduras or Nicaragua late this week.
COTTON
March Cotton is higher this morning after falling to its lowest level since September 11 yesterday. The market has been under pressure from a rally in the dollar and concerns that if high US tariffs are put in place it would hurt incite retaliation from China and hurt US export prospects. The Dollar Index was sharply higher overnight and the nearby contract took out the October 2023 high and reached its highest level since November 2022. On the other hand, the threat of retaliation may be encouraging buyers ahead of such action, and low prices may be attracting buyers as well. The US export sales report is delayed until tomorrow. Last week’s report showed net sales of 229,039 bales, their highest so far for the 2024/25 marketing year.
SUGAR
March Sugar held yesterday’s low overnight but barely. The market sold off this week despite the drop in Brazil Center-South production during the second half of October that was reported in the bi-monthly UNICA report, as that was largely anticipated. The dollar strength and renewed weakness in the Brazilian real encourages producers to sell what supplies the have. Brazilian crop prospects for 2025 have improved with the arrival of over the past few week, and, sugarcane areas look to remain in very good condition through the balance of this month with alternating periods of rain and sunshine.
Interested in more futures markets? Explore our Market Dashboards here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2025 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
Latest News & Market Commentary
ADM & Industry News
Happy Holidays From ADM Investor Services!
December 18, 2024
The Ghost in the Machine Q4 2024
November 15, 2024