Cocoa Holds Highs as Stocks Tighten

COCOA

March Cocoa held its own early Friday as it traded inside the upper end of Thursday’s range. The market has reached its highest level since early November, but it has climbed into oversold territory after rallying $1,551 (31%) in less than three weeks. A slowdown in Ivory Coast port arrivals has suggested that this year’s crop will not be as strong as previously hoped. Adding to support is anticipation that spec interest will expand greatly in the new year when cocoa gets added to the Bloomberg Commodity Index. World Weather Inc says Ivory Coast and Ghana will receive some unusually heavy rainfall for this time of year during the weekend and early part of next week, which will disrupt crop cocoa maturation and harvesting. However, the rains could also support production later in the season, especially if the Harmattan winds are not strong. ICE cocoa stocks fell 4,772 bags on Thursday to 1.660 million, the lowest since March 13. Stocks have declined for nine straight sessions.

COFFEE

March Coffee was lower early Friday after reaching its highest level ins six sessions on Thursday. The market has been trading in a narrow range since putting in a spike low after the Brazilian tariffs were lifted, and it has also been basically trendless since September. Brazilian green coffee exports were significantly below year ago levels in November, which is attributed to the tariffs but also perhaps on lower output for 2025/26 as well. World Weather Inc. expects a big increase in rainfall in Brazilian arabica regions through Sunday followed by frequent rain and thunderstorm activity through the end of next week. That and seasonable to slightly cooler-than-usual temperatures should benefit crop development. London robusta prices have been drifting lower as drier conditions in Vietnam are allowing harvest to resume. ICE certified arabica stocks increased by 1,094 bags on Thursday to 416,375.

COTTON

March Cotton was moderately higher early Friday following a lower close on Thursday. The export sales report on Thursday was not as strong as the previous week, but it was decent relative to recent trend. Weakness in the US dollar lends moral support, as it makes US cotton appear cheaper on the world market. The report showed cotton sales for the week ending November 13 at 187,648 bales for the 2025/26 (current) marketing year and 1,760 for 2026/27 for a total of 189,408. This was down from the 388,938 the previous week, but that report was a record for the marketing year, and this report was still the second strongest since October 16. Cumulative sales for 2025/26 have reached 5.441 million bales, down from 6.046 million at this time last year and still the lowest in 11 years. Sales have reached 49% of the USDA forecast versus a five-year average of 65% for this point in the marketing year. Vietnam was the largest buyer once again at 65,195 bales, followed by Turkey at 59,821. China was seventh at 5,739. India canceled one bale. Both nations have stepped back on their buying since an initial wave in the immediate aftermath of trade negotiations.  The next report will be Monday, December 15, and it will cover the week ending November 20. The nearby Dollar Index fell to its lowest level since October 25 yesterday.

SUGAR

March Sugar was sharply higher early Friday after pushing above the 50-day moving average for the first time since early October. The rally was likely aided by the record or near record short positions held by speculators, which have left the market vulnerable to short covering. For example, Wednesday’s Commitments of Traders report showed that as of November 10, non-commercial and non-reportable traders combined were net short 191,614 contracts, a new record, and the managed money net short was 205,988, the largest since November 2019. The record net short is 234,839 from September of that year. The market has also drawn support this week from by reports that farmers in Thailand were switching from cane to cassava in response to low sugar prices. The next UNICA update on Brazil Center-South sugar production, covering the second half of November, should be released next week. The last report showed sugar production for totaled 982,000 metric tons for the first half of November, up from 904,000 for the same period last year. Cumulative production had reached 39.178 million tons versus 38.379 million at this point last year (+2.1%). But what has caught traders’ eyes has been the shift in crushing activity from predominantly sugar to predominantly ethanol, with sugar’s share of crush falling to 38.6% in the first half of November from 46.1% in late October and 43.1% a year ago. Crush has fallen from as high at 55% in August, and it fell below 50% in late October.

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