The Stipelis Agricultural Index Indicator finds resistance at upper level and pulls back 3.42% as cocoa leads the downside. Bullish pockets remain even as risks are mounting.
From the Trading Desk at Stipelis 4-29-2025
Agricultural markets took a decisive step back this week, with the Stipelis Agricultural Index Indicator dropping 3.42%. The main drag? Cocoa, which cratered 4.79% week-over-week and is now down more than 23% YTD. After a relentless rise earlier this year, the contract appears to be in correction mode, pulling the softs complex—and broader ag sentiment—with it.
Cocoa’s reversal is emblematic of the rotation we’re seeing in ags: previously hot names cooling off fast, while select corners continue to grind higher. Coffee (+2.55%) was the week’s bright spot, and soybean oil quietly posted a 1.28% gain, now up 11.18% month-to-date and 23.66% YTD. Live and feeder cattle also held up, both logging modest weekly gains as seasonal strength persists in the protein markets.
But those green prints were the exception. The majority of ag markets were lower, with wheat (-2.74%), corn (-0.68%), cotton (-1.82%), and sugar (-1.82%) all under pressure.
This is especially notable in wheat, which is now down over 6.5% YTD despite recent supply concerns. The commodity continues to battle macro headwinds, including a strong U.S. dollar and choppy export demand.
Soybean meal (-1.03%) and lumber (-0.52%) also contributed to the downside. Meal in particular looks technically vulnerable, having given back all MTD gains. Interestingly, soybeans themselves eked out a 0.21% WTD gain, suggesting the crush spread may be under review by the trade.
The broader takeaway: while the Ag Index remains up 10.88% month-to-date, the current week’s pullback reveals some cracks. Cocoa’s rapid descent likely forced position adjustments across other contracts, particularly in softs. Cotton and sugar were both down nearly 2%, suggesting a general de-risking in that space.
From a tactical standpoint, the market seems to be differentiating between commodities that still have seasonal or structural tailwinds (coffee, soybean oil, cattle) and those that may have overshot (cocoa, wheat, sugar). Add in uncertain macro data and upcoming weather risk, and this could be a pivotal moment for ag positioning.
We’re watching cocoa closely. If the unwind continues, it could drag the complex lower and shift sentiment more broadly. On the flip side, if volume dries up and price stabilizes, the market may start rotating into other commodity plays—particularly where YTD momentum remains strong.
Stephen coleman