ADMIS News
COCOA
The cocoa market has been pressured by near-term demand concerns for over 2 years, and those were reinforced by disappointing quarterly grinding results from Asia and North America. The longer-term demand outlook remains firmly bullish, however, and that can help cocoa to find support. The International Cocoa Organization (ICCO) released their latest quarterly supply/demand report and cut their 2021/22 global cocoa production estimate by 31,000 tonnes down to 4.923 million.
COFFEE
Coffee prices continue to climb further away from the mid-May low as the market is receiving bullish developments from the supply and demand side of the market. If global risk sentiment can see a positive turnaround, coffee prices should climb further to the upside. May coffee exports from Honduras came in 23% below last year’s total while last month’s exports from Costa Rica were 35% below their 2021 total, which provided underlying support as it reflects supply issues that are in addition to the production problems seen from the world’s top 2 Arabica producing nations.
COTTON
July cotton sold off sharply yesterday, closing at its lowest level since April 26. December cotton also sold off sharply. The dollar was up sharply, and the stock market was down, and both moves were negative to cotton. US authorities are ready to implement a ban on imports from China’s Xinjiang region that was signed into law in December.
SUGAR
Sugar prices continue to hold their ground above the 50-day moving average. Although they will continue to need carryover support from a key outside market, sugar prices should remain fairly well supported on a near-term pullback. RBOB gasoline prices continue to rally up into multi-year highs while crude is holding its ground near Tuesday’s high for the move, both of which provided carryover support to the sugar market.
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