March Sugar Tests 50-Day Average

SUGAR

After closing above the 50-day moving average for the first time since October on Friday, March Sugar fell back below that line early Monday. Friday’s Commitments of Traders Report showed managed money traders were net buyers of 11,404 contracts of sugar for the week ending November 18, reducing their net short to 194,584. This is still very large and still leaves the market vulnerable to heavy short covering if resistance levels are taken out, but the fact that the market did see some short covering that week may have traders less concerned about the burdensome short, especially with the data reflecting conditions from a month ago. The previous report did show 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. It may be too much to ask for this market to build a substantial rally based sole on an extremely oversold position on the part of the funds. On the fundamental side, bearish factors include good growing weather in Brazil, with World Weather Inc. saying over the weekend that sugarcane areas are expected to get timely rainfall to support normal development this week. Also sugar consumption is being pressured by the success in GLP-1 weight loss drugs. Eli Lilly said its next-generation obesity drug helped patients to lose an average of 28.7% of their weight.

COCOA

March Cocoa was lower early Monday after Ivory Coast port arrivals showed an improvement over the previous week, which eased concerns that the West African main crop was struggling. Arrivals totaled 91,000 metric tons for the week ending December 14, up from 85,000 the previous week and 75,000 a year ago. The five year average for the week is 85,000. Cumulative arrivals for the 2025/26 marketing year have reached 894,000 tons versus 895,000 a year ago and a five year average of 991,000. Having the weekly arrival increase last week after may be a relief to those were worried about this year’s production after last week’s total fell 15,000 tons from the previous week. Arrival totals can be choppy this time of year, but they do tend to peak in early November. World Weather Inc. says Ivory Coast and Ghana are seeing more rainfall than is normal for this time of year. This can delay cocoa maturation and harvest progress and slow drying times for harvested beans and pods. However, it could also boost production later in the season. Drier weather is expected to develop later this week and last through most of next week.

COFFEE

March NY Coffee was under pressure early Monday, falling to its lowest level since November 21, the day it put in a spike low in the wake of the lifting of the tariffs on Brazilian imports. The market may have seen some pressure from the London robusta market overnight after it broke below the bottom of a four month trading range. World Weather Inc says Brazil coffee growing areas saw abundant rain over the weekend and is expected to see more in the coming week, which should be beneficial for 2026/27 crop development. The improved rainfall pattern of the past couple of months has been noticed by market analysts. Reuters reported on Friday that the consultancy Hedgepoint is forecasting the 2026/27 coffee harvest at 71-74.4 million bags, with arabica production forecast at 46.5-49.0 million, up from 37.7 million in 2025/26 and robusta at 24.6-25.4 million bags, down from 27.0 million in 2025/26. This will be the on-year for Brazil’s arabica crop. World Weather Inc noted that Indonesia has seen abundant rain recently and that there is a risk of excessive rain and flooding for the next week to ten days, Vietnam coffee area are expected to see a sporadic and light precipitation pattern and that any disruption to farming activity is expected to be brief. Cash traders in Vietnam interviewed by Reuters last week said harvest is slowly picking up after the rain delays and they expect this season’s output to be about 10% above last year.

COTTON

March Cotton was higher early Monday and was approaching to the upper end of last week’s range. The market may be drawing some support in anticipation of the Export Sales update later this morning. This report will cover the week ending November 20. The last report (on Thursday) had net sales of 189,408 bales for the week ending November 13, which was not bad, but it was nowhere near the 388,938 for the week prior to that. Sales are running at a slow pace, with cumulative sales the lowest in 11 years and 49% of the USDA forecast versus a five-year average of 65% for this point in the season. Nonetheless, sales have been running at a stronger pace in the last couple of reports. The dollar fell to its lowest level since October last week and was softer this morning, which helps make US exports more attractively priced on the world market. World Weather Inc. says Australia’s cotton crop would benefit from rain in western, dryland, production areas where recent hot and dry conditions may have slowed some development. Eastern crop areas are suspected of being in mostly good shape.

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