ADMIS News
Ag Market View for May 20.25
May 20, 2025
COCOA
May Cocoa is slightly lower this morning but inside the ever-narrowing range of the past few weeks. The market has managed to stay above the 200-day moving average since testing that level on March 21. The key supportive factor is the expectation for a sharply lower Ivory Coast mid-crop due to the dry conditions that emerged in late 2024 and extended into this year. World Weather Service said parts of west Africa saw some rain over the weekend but stressed that in most cases the moisture was not enough to offset evaporation. More showers are expected this week. Many areas will be impacted, but not all. Ivory Coast crop cocoa arrivals were estimated at 14,000 metric tons for the week ending March 30, up from 13,000 the previous week but below 17,000 from a year ago. Cumulative arrivals have reached 1.441 million tons up from 1.297 million a year ago. ICE certified cocoa stocks increased 6,806 bags on Friday to 1.806 million, which is the highest since October 25. Stocks increased by 21,809 bags last week, and they have increased 436,000 since the start of the year.
COFFEE
May Coffee was slightly higher overnight but was still hovering near the low end of a two month range. Brazil’s largest coffee cooperative, Cooxupe, has raised its expectations for the 2025 crop. The president of the organization said on Friday that they expect to receive 6.1 million bags from farmers in 2025, up from a previous expectation of 5.6 million. This would be similar to their 2024 receipts. This appears to be a sharp contrast to forecasts for Brazil to see a smaller crop for the year given the extreme drought in 2024 and the fact that this is the off year in the biennial cycle for arabica production. A slow start to the rainy season has lowered expectations further. World Weather Services reported limited rainfall in Brazil’s coffee areas over the weekend, mostly too light to counter evaporation, which has been the trend for several weeks. The greatest decline in crop conditions occurred in February and early March, but even as rains increased somewhat later in the month, they continued to be below average. These conditions are not expected to change in the first half of April. ICE certified arabica stocks fell 6,241 bags on Friday to 771,576, the lowest since February 18. The amount pending grading increased by 4,250 bags on Friday to 55,172, the highest since March 4.
SUGAR
May Sugar has reversed higher this morning after breaking below the 100-day moving average overnight. Around the same time the market put in the overnight low, the Indian Sugar and Bio-Energy Manufacturers Association reported that Indian mills had produced 24.8 million metric tons of sugar as of March 31. Their marketing year runs from October through September, but most of the harvest is completed between December and March. In mid-March the group had lowered its total production forecast for 2024/25 to 26.4 million tons from 27.2 million previously. The state of Uttar Pradesh has been the biggest producer at 8.75 million tons. Factories there are expected to remain operating until mid to late April. Karnataka has produced 3.96 million tons to date. Only two mills there remain operational, but some factories in South Karnataka are expected to restart during the special season that runs from June or July to September. Last week’s UNICA report showed Brazil Center-South sugar production for the first half of March totaled 52,000 tons, down from 64,000 a year ago but up from 9,000 for the second half of February.
COTTON
May Cotton was slightly lower overnight but still in the upper half of last week’s range, as the market waited for the USDA Prospective Plantings report later today. For the report, the Bloomberg survey shows an average trade expectation of 9.9 million acres (range 8.8-10.5 million) versus 10.0 million in the Outlook Forum and 11.2 million in 2024, while the Reuters poll has an average guess of 10.189 million acres (range 9.85-10.5). Some traders had suggested that plantings would be lower with prices having fallen to new four-year lows earlier this month. The market saw a rally last Thursday in the wake of an export sales report that showed strong deliveries despite weak sales. However, May Cotton failed to make a break above the 50-day moving average after its third attempt inside six weeks.
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