Key Takeaways
- • Cotton conditions deteriorate: USDA reports cotton crop conditions remain well behind year-ago levels with deterioration last week during squaring and boll-setting phase; December futures trading in mixed trends with support at 77.10–74.50 and resistance at 82.90–86.20.
- • Coffee harvest delays offset by increased availability: Brazil harvest delays continue but global coffee supply is rising; Cooxupe reported increased sales at 58.3% of crop last week; ICO average price stands at 282.18 ct/lb with deliverable stocks below 300,000 bags and well below prior year.
- • Cocoa production forecast decline of 16% in Ghana: Ghana's cocoa production expected to fall by at least 16% in the 2026–2027 season due to weather effects, natural fruit-bearing cycle, and disease; Ivory Coast also experiencing weather challenges affecting crop yield.
- • Sugar rallies despite geopolitical uncertainty: Iran war pause following memorandum of understanding supports biofuel valuations; drought concerns in Europe and Brazil weigh on sugarbeet production, though drier weather improves harvest conditions in parts of Brazil and India.
- • Corn and soybean demand support prices amid weather volatility: Mexico purchased 120,000 tons of U.S. corn and China bought 132,000 tons of U.S. soybeans; northern Midwest rain forecasted to benefit crops while hot, dry conditions persist in southern and western regions.
Summary
The softs complex displayed mixed technical signals across major commodity markets on August 5, 2026, as weather patterns and geopolitical developments shaped price dynamics. Cotton futures declined alongside crude oil weakness, with USDA data showing crop conditions substantially behind year-ago levels and deterioration in the preceding week. The cotton crop, currently in the squaring and boll-setting phase, is progressing at average pace with warm to hot temperatures and scattered to isolated showers forecast for Delta and Southeast regions. December cotton futures established mixed daily trends but upward weekly momentum, with support levels at 77.10, 75.50, and 74.50, and resistance at 82.90, 84.20, and 86.20.
Brazil's coffee harvest delays persisted, yet global supply pressures mounted as coffee availability increased throughout producing regions. Cooxupe reported accelerated sales activity at 58.3% of the crop the previous week, contributing to selling pressure despite higher valuations in New York and London. The International Coffee Organization average price reached 282.18 ct/lb. Deliverable stocks fell below 300,000 bags, significantly lower than the prior year. Indonesia is approximately 80% harvested with favorable Asian conditions overall, while Mexico maintains good growing conditions, though Central America faces dryness. The next South American crop is developing well amid scattered showers. September coffee futures in New York showed mixed trends with support at 300.00, 285.00, and 279.00, and resistance at 372.00, 384.00, and 396.00.
Cocoa markets faced significant structural headwinds with Ghana's market regulator COCOBOD announcing an expected production decline of at least 16% in the 2026–2027 season, citing weather effects, the crop's natural fruit-bearing cycle, and disease pressures. Ivory Coast also contends with adverse weather affecting yields. Despite consolidation trading, demand recovery has begun following elevated prices in the prior year, partially offset by concerns about high-price demand destruction. A major main crop harvest has commenced in West Africa with beneficial rains for the next crop cycle, while production potential increases are emerging in Asia and Central America.
Sugar markets advanced for the second consecutive day following a memorandum of understanding between Iran and combatants, reducing geopolitical risk to biofuel valuations. However, drought conditions in Europe and Brazil remain a material concern, with hot and dry weather causing sugarbeet production losses. Brazil experienced some harvest delays due to center-south rains, though generally dry weather is now forecast. Improved harvest conditions have benefited cane and beet production in parts of Brazil and India. October sugar futures in New York showed mixed daily trends with support at 1,440, 1,410, and 1,380, and resistance at 1,590, 1,620, and 1,650.
Grain and oilseed markets reflected international demand strength tempered by weather volatility. Mexico purchased 120,000 tons of U.S. corn while China acquired 132,000 tons of U.S. soybeans, supporting prices despite forecasts of weekend and midweek rain in the northern Midwest. Corn export sales reached the higher end of expectations, though hot and dry conditions persist in western and southern regions. Soybean crop conditions remain unchanged from the prior week but below year-ago levels, with rapid blooming and pod-setting progress reported. Cooler temperatures and wet weather are expected in northern Midwest areas, while southern regions should remain hot and dry. Palm oil rose on improving demand expectations ahead of Indian festival season, with Malaysian refined bleached deodorized palm oil cash prices ranging from 1,145.00 to 1,217.50 U.S. dollars per metric ton across delivery months.
Brazil's coffee harvest delays persisted, yet global supply pressures mounted as coffee availability increased throughout producing regions. Cooxupe reported accelerated sales activity at 58.3% of the crop the previous week, contributing to selling pressure despite higher valuations in New York and London. The International Coffee Organization average price reached 282.18 ct/lb. Deliverable stocks fell below 300,000 bags, significantly lower than the prior year. Indonesia is approximately 80% harvested with favorable Asian conditions overall, while Mexico maintains good growing conditions, though Central America faces dryness. The next South American crop is developing well amid scattered showers. September coffee futures in New York showed mixed trends with support at 300.00, 285.00, and 279.00, and resistance at 372.00, 384.00, and 396.00.
Cocoa markets faced significant structural headwinds with Ghana's market regulator COCOBOD announcing an expected production decline of at least 16% in the 2026–2027 season, citing weather effects, the crop's natural fruit-bearing cycle, and disease pressures. Ivory Coast also contends with adverse weather affecting yields. Despite consolidation trading, demand recovery has begun following elevated prices in the prior year, partially offset by concerns about high-price demand destruction. A major main crop harvest has commenced in West Africa with beneficial rains for the next crop cycle, while production potential increases are emerging in Asia and Central America.
Sugar markets advanced for the second consecutive day following a memorandum of understanding between Iran and combatants, reducing geopolitical risk to biofuel valuations. However, drought conditions in Europe and Brazil remain a material concern, with hot and dry weather causing sugarbeet production losses. Brazil experienced some harvest delays due to center-south rains, though generally dry weather is now forecast. Improved harvest conditions have benefited cane and beet production in parts of Brazil and India. October sugar futures in New York showed mixed daily trends with support at 1,440, 1,410, and 1,380, and resistance at 1,590, 1,620, and 1,650.
Grain and oilseed markets reflected international demand strength tempered by weather volatility. Mexico purchased 120,000 tons of U.S. corn while China acquired 132,000 tons of U.S. soybeans, supporting prices despite forecasts of weekend and midweek rain in the northern Midwest. Corn export sales reached the higher end of expectations, though hot and dry conditions persist in western and southern regions. Soybean crop conditions remain unchanged from the prior week but below year-ago levels, with rapid blooming and pod-setting progress reported. Cooler temperatures and wet weather are expected in northern Midwest areas, while southern regions should remain hot and dry. Palm oil rose on improving demand expectations ahead of Indian festival season, with Malaysian refined bleached deodorized palm oil cash prices ranging from 1,145.00 to 1,217.50 U.S. dollars per metric ton across delivery months.
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