Latest news with #MichaelMcDougall
Bloomberg
2 days ago
- Business
- Bloomberg
Arabica Coffee Rises to Two-Month High on Adverse Brazil Weather
Arabica coffee futures advanced in New York to the highest level in two months on worries multiple bouts of cold weather and light frost could curb output in top grower Brazil. There's growing concern that this year's coffee crop in Brazil will be lower than expected due to adverse weather, said Michael McDougall, an analyst at McDougall Global View. 'It is not only the current crop that is worrying, but the 2026 crop could be limited as well as bouts of cold weather are already inducing early stress flowering.'
The Independent
11-07-2025
- Business
- The Independent
Prices of these two drinks could surge if Trump's Brazil tariffs stick
U.S. consumers face sharp price increases on essential food items like coffee and orange juice should the Trump administration proceed with its plan to levy a 50 percent tariff on all imports from Brazil, traders and experts say. President Donald Trump announced new tariffs on Wednesday, which included raising the duty on Brazilian imports from 10 percent to 50 percent, effective from August 1, despite the U.S. having a $7.4 billion trade surplus with Brazil, according to U.S. Census Bureau data. In terms of agricultural commodities, Brazil produces nearly half the world's arabica coffee and is by far the world's largest orange juice producer, accounting for 80 percent of global exports, industry figures reveal. Brazil is also the world's top sugar producer, but does not ship significant volumes to the U.S. "With (U.S. sugar) consumption at 11.185 million tons, a 50 percent increase on 312,000 tons of (Brazil) sugar shouldn't have a large impact. The bigger impact will be in coffee and orange juice. I'm thinking Acai berries as well," said sugar analyst Michael McDougall, pointing out that Trump may yet row back on his plan. The overwhelming majority of U.S. Acai imports come from Brazil, the world's largest producer, according to a report by Grand View Research. U.S. Commerce Secretary Howard Lutnick said last month during a Congress hearing that some natural resources that are not available in the U.S., such as tropical fruits and spices, could be exempt from tariffs, depending on negotiations with the countries producing and exporting them. "I don't think it would be economically feasible to sell Brazilian coffee to the U.S. with the 50 percent tariff. Let's see how this will evolve, but it would be very complicated," said the Brazil head of a major global commodities trader. Around a third of the coffee consumed in the U.S., the world's largest drinker of the beverage, comes from Brazil, which has in recent years been shipping about eight million 60 kg bags a year there, according to industry groups. More than half of the orange juice sold in the U.S. comes from Brazil, meanwhile. The U.S. has become more dependant on orange juice imports in recent years due to a sharp decline in domestic production, particularly in Florida, due to the 'citrus greening' crop disease, hurricanes and spells of freezing temperatures. A report issued by the U.S. Department of Agriculture earlier this year forecast the U.S. orange harvest would hit an 88-year low in the 2024/25 season while production of orange juice would slump to a record low. Brazil also exports a modest amount of beef to the U.S., and the tariff has been welcomed by U.S. cattle producers. "We fully support this tariff on Brazil. Brazil's exports (have) contributed to the shrinking of our U.S. cattle industry. We need to rebuild and reduce our nation's dependency on imported food. This is a step in the right direction," said R-CALF USA. In terms of energy, Brazil is the world's second-largest producer of the cane or corn-based biofuel ethanol. The South American country produced some 35 billion litres of ethanol in 2024, but exported less than 6 percent, of which only some 300 million litres went to U.S., according to a report from BTG Pactual. Energy major Shell is exposed to Brazil's biofuel market via Raizen, a joint venture between itself and Brazilian conglomerate Cosan, while BP is exposed as it now has full ownership of Brazilian sugar and ethanol producer BP Bunge Bioenergia. In a letter to Brazilian President Luiz Inacio Lula da Silva setting out his tariff plan, Trump criticised what he saw as Brazil's attacks on free elections, social media platforms and digital trade activities of U.S. companies.
Mint
04-06-2025
- Business
- Mint
Sugar Steadies After Hitting Four-Year Low on India Crop Outlook
(Bloomberg) -- Raw sugar wavered after hitting the lowest in almost four years in New York, as traders see improving supply prospects while buyers are taking opportunity to close deals at low prices. The most-active futures contract pared losses after falling as much as 1.3% on Tuesday to 16.66 cents per pound, the lowest since June 2021. Prices are down nearly 13% this year on improved supplies, with expectations for a global surplus in the 2025-26 season. 'There has been demand down near 17 cents per pound and below,' said Michael McDougall, an analyst at McDougall Global View. Still, he pointed to buyers choosing the moments to close deals, as a favorable weather outlook at top producers weighs on prices. Second-largest grower India will likely see gross production jump due to more plantings in key growing areas and favorable monsoon rains. More output in India could bolster changes for exports after the government had allowed overseas shipments of 1 million tons in the 2024-25 season. Meanwhile, mills at top exporter Brazil are seen continuing to maximize sugar production at the expense of ethanol. Earlier data on the country's harvest already showed a high sugar mix, which is the percentage of cane used to make sweetener. Now, a decline in gasoline prices is set to affect the biofuels market, as most cars in the country are able to run on any mix of gasoline or ethanol. 'The market continues to be attentive to the pace of the Brazilian harvest and the dynamics of external demand, which has yet to show more consistent signs of recovery,' Bruno Zaneti, StoneX senior risk management consultant, said in a Tuesday note. More stories like this are available on
