Dryness Concerns in Indonesia

COFFEE

Weather patterns in Brazil post little or no threat to the coffee crops there, but less than ideal conditions could be emerging other important growing areas around the world. World Weather Service reports that less than usual rain continues to impact Indonesia and that a boost in precipitation will soon be needed. Concerns could also emerge in southern India, parts of Vietnam’s Central Highlands and a few areas in the Greater Antilles due to lighter than normal rainfall there. The opposite is true for Mexico, which is seeing too much rain. Brazil’s coffee areas are no risk of seeing crop damaging cold, despite some very cold air in Argentina and Uruguay later this week.

SUGAR

UNICA will release their bimonthly report on Brazilian center-south sugar production for the first half of June today, and analysts polled by S&P Global are expecting a significant reduction from the same period last year. The poll an average expectation for crushing to come in at 39.87 million metric tons, down 19.3% from a year ago. (Second-half May crush was 47.84 million, up 5.47% from 2024.) Sugar production is expected to come in around 2.52 million tons, down 19.9% from a year ago versus a second-half May production of 2.951 million, which was up 8.9% from a year ago. The range of estimates are wide, however. The India Meteorological Deportment India reports that the nation saw 9% more rainfall than the long-period average for June, as the monsoon covered the entire country ahead of schedule. The central, north-western parts of the country received above average rainfall, while north-eastern regions saw below average rainfall. monsoon rains covered the entire country on Sunday, nine days earlier than normal. World Weather Service says heavy rains in central, north and eastern parts of the nation during the next ten days could result in local flooding and some crop damage. Southern India will be unusually dry during the period.

COTTON

December Cotton is lower this morning after reaching its highest level since May 12 on Friday, and the trade is expected to be cautious ahead of the acreage report later today. For the report, the Reuters poll has an average trade expectation for US cotton plantings at 9.735 million acres, with a range of expectations of 8.800 to 9.985 million. This average expectation is down 1.3% from the March intentions number of 9.867 and down from 11.138 million last year. Over the last 25 years, the June acreage report has shown an increase over the March report 12 times and a decrease 13 times. The average increase was 5%, and the average decrease was also 5%. A 5% decline from March would put planted area at 9.4 million acres. The wet conditions in the Delta this spring could have lowered actual plantings from the March estimate. The market seems to have drawn support from hopes that trade deals reportedly being worked out between the US and various countries will support cotton export sales. The dollar falling to its lowest level since February 2022 also improves the US export outlook, and stock indices back at all time highs show a level of economic optimism that should support cotton consumption. The US export pace is slow, with cumulative sales for both the 2024/25 (current) marketing year and for 2025/26 the lowest the lowest since 2014/15.

COCOA

World Weather Service said rainfall in west-central Africa lightened up greatly over the weekend, and this might be viewed as beneficial for the crop. A mixture of rain and sunshine is needed for healthy growing conditions. The region will have opportunity for showers and thunderstorms during the next week to ten days. Daily rainfall will be erratic and mostly light to moderate, but there will be some potential for moderate to heavy rain in a few areas, albeit infrequently. Nearly all of the region from Ivory Coast to Nigeria and Cameroon will be impacted by rain at one time or another by mid-week next week.

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