ADMIS News
COCOA
Cocoa prices have recovered most of their losses from the late January downdraft and have climbed back above the 3 major moving averages. If global risk sentiment continues to improve, cocoa could see a retest of its mid-January high. A weaker Dollar was a catalyst for the “risk on” mood in many commodities, which was particularly helpful for cocoa prices as that also helps to strengthen its near-term demand outlook.
COFFEE
Coffee prices have seen coiling action over the past few weeks that has kept the market well clear of its early January low. With tightening near-term supply, the trend could turn up at any time. The Brazilian currency extend its 2022 rally to a new 4-month high, which provided coffee with carryover support as it eases pressure on Brazil’s farmers to market their remaining near-term supply.
COTTON
March cotton closed lower yesterday after trading to another new contract high. The dollar was lower again, which was supportive to cotton. The stock market was higher and so was crude oil, and both of those moves are supportive to cotton as well. Traders noted some profit taking in cotton after the move to new highs, and there was also talk of index funds rolling positions.
SUGAR
Sugar prices have started February more than 2.00 cents below their November high as larger production from Thailand, India and the EU have been a source of recent pressure. With key outside markets fairly strong, however, sugar is in a good position to at least experience a bounce. While energy markets have lost upside momentum, they remain in close proximity to multi-year high which should further strengthen ethanol demand in Brazil and Indian that in turn provides support to sugar prices.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
