Commodity snapshot

•The S&P GSCI Agriculture Index dropped by 0.6% in the last two weeks. Corn and soy were largely range-bound, but the US election will likely bring volatility. Meanwhile, the wheat market faces a drop in global production and potential changes in Russian export policy. For arabica and robusta, forecast rainfall in Brazil materialized as the BRL depreciated, pushing down prices. London Cocoa increased 4.4% in the last two weeks, with most of the gains coming in the last few days, as some market participants fear a potential deficit. Sugar saw gains despite wet weather, a depreciating BRL, and large fund net selling.

•ICE Arabica futures fell 3.8% in the last two weeks to USc 249.6/lb. The expectation of outstanding rainfall in Brazil noted in our prior snapshot came to fruition, resulting in prolific flowering and lower prices. While this has brought some short-term relief, damage done by the drought must have caused irreversible losses.

•ICE #11 Sugar prices were up by 2.8% in the last two weeks, even though the BRL depreciated by 1.7% in the same period. The return of wet weather brought relief to a market that went through a spike in excitement on the back of the fires seen across the sugar belt, especially over September. But looking ahead, we expect to see mill closures in Brazil that will bring further support.