From the Ebola outbreak to the likely return of El Niño or La Niña, the 2014/2015 outlook for global agriculture is not clear.
The outcomes depend on the changes in weather, competition for sugar exporters and demand for cotton from China.
Soft commodity prices were highly unstable in 2014, and cocoa futures ended below $3,000 in late October for the first time since May following abundant harvests in West Africa and tepid demand from Asia.
Edward George, head of group research at Ecobank, says: “Any case of Ebola in these countries [Ghana and Côte d’Ivoire] will immediately be felt. And should this happen in cocoa-producing areas, it will be catastrophic.”
Drought in Brazil, the world’s main coffee exporter, led to an increase in Arabica prices, from $1.30/lb at the beginning of the year to $2.25/lb by mid-October.
Rain was expected by early November, reassuring traders of a normal harvest next season.
The price of Intercontinental Exchange December cotton dropped to $0.64/lb on 31 October amid expectations of a fifth consecutive annual rise in global stocks in 2014/2015.
China is set to reduce imports by 33% in 2014/2015 to 9.2m bales, setting off a bearish outlook and dampening the hopes of key cotton-producing countries in Francophone West Africa, which forecast a 19% increase in production for the 2014/2015 season.
Africa’s main sugar exporters – Uganda, Mozambique, Zambia and Malawi – are struggling to compete with inexpensive imports from Brazil, India and Thailand and falling prices due to a global glut expected in 2014/2015.