ADMIS News
Wkly Futures Market Summary For 2.10.2025
February 10, 2025
COCOA
December Cocoa broke out above a nearly two-month trading range overnight and traded to its highest level since June 21. News that Ghana cocoa regulator Cocobod will open its 2024/25 season on September 1, earlier than usual, raised expectations for chance of loosening up supply, but the group has also lowered its target quantity for purchases this year to 650,000 metric tons from an earlier prediction of 810,000. This comes after the nation experienced one of its poorest harvests in a decade in 2023/24 due to harsh weather, smuggling, and swollen shoot disease. Ghanian cocoa farmers said they expect higher production in 2024/25 due to improved weather and some farms having been rehabilitated after disease and illegal gold mining hurt their production. Farmers in Ivory Coast this week expressed some concern about some cooler weather last week, because if it stays that way, it could ultimately lower production for the main crop. Good rains mixed with sunny spells are in September and October would help the main crop last longer.
COFFEE
December NY Coffee fell back overnight after trading to a new contract high yesterday. The London Robusta contract trade to new all-time highs yesterday and was near unchanged overnight. Price pressure from Brazil may have eased now that the robusta harvest is complete and the arabica harvest fast approaching that point. As of last week harvest was estimated at 94% complete versus 87% a year ago and an average of 89%. Dry weather in Brazil this year has allowed the harvest to advance quickly, but it has also raised concerns about the upcoming crop. World Weather Service expects warm temperatures and limited rainfall over through Friday in Brazilian coffee growing areas. Some cooling is expected this weekend but no threat of frost. Rain will be limited. The 14-day outlook calls for below normal precipitation. Reuters quoted dealers yesterday that exports from Vietnam remain slow and that farmers in Indonesia are holding onto stocks in the hope that prices may rise further. Vietnam is expected to see sufficient rainfall over the next week to support crop needs. ICE arabica stocks fell 880 bags to 842,230 bags yesterday after reaching their highest level since June 26 on Monday.
COTTON
December Cotton was higher overnight and reached its highest level since August 12, when the market experienced a brief but sharp bounce following a USDA supply/demand report that came in at the bullish end of expectations. A decline in US crop conditions and a weak dollar have support the rally this week after the market fell to new contract lows last Friday. The Crop Progress Report on Monday showed 42% of the US cotton crop was rated good/excellent, which was down from 46% the previous week and the lowest it had been all season. Texas was 29% G/E, down from 33% last week and also the lowest for the season. Both are well ahead of a year ago. An expanding in west Texas has been a major factor in the decline. Also, a record net short held by the funds leaves the market vulnerable to short covering. The nearby Dollar Index has fallen to its lowest level since the first week of January, which improves the competitiveness of US cotton on the world market. World Weather Service expects some more extreme heat in Texas Wednesday through Saturday which will lead to more crop stress, especially in unirrigated fields. US and global supply still looks ample, but it seems to be trending lower.
SUGAR
October Sugar was near unchanged overnight after falling to its lowest level since March 2023 yesterday. There are concerns about sluggish demand from China, one of the world’s largest importers. The market has also seen some pressure from the sharp decline in oil prices over the past week. The USDA attaché in Cairo yesterday lowered their forecast for 2024/25 sugar production to 2.6 million metric tons, down 110,000 tons from the USDA’s estimate for 2023/24, due to lower cane production. Their domestic sugar consumption is expected to reach 3.75 million tons, up 350,000 tons from 2023/24. Imports are expected to reach 1.5 million tons, up 500,000 from 2023/24.
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.
© 2021 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.
