ADMIS News
COCOA
Cocoa prices held up fairly well during Friday’s severe negative shift in global risk sentiment and key outside markets that weakened its near-term demand outlook. With supply-side factors returning to a front-and-center position in the market, cocoa should finish August by breaking a 4-month losing streak.
COFFEE
From mid-July until mid-August, the coffee market saw coiling price action, with sharp rallies followed by quick pullbacks. After a daily reversal on August 19, prices rallied more than 26 cents (+12%) in just four sessions, but the coffee market has a bullish supply outlook that could improve further by the end of September. For the week, December coffee finished with a gain of 24.75 cents (up 11.6%) which was a third positive weekly result over the past 5 weeks.
COTTON
December cotton closed higher on Friday and experienced the highest close since June 17. The dollar reversed higher, but this had little effect on cotton as traders are more focused on the poor US crop and the expected strong export demand even as the dollar gains strength. Reports that China will take more steps to support their economy were supportive as well, as that would support US cotton exports. The 6-10 and 8-14-day forecasts call for normal to above normal chances of rain across Texas, the Delta, and the Southeast. The rain is coming too late to save the Texas crop, and we are getting to the point in the season where growers will be concerns about rainfall damaging open bolls.
SUGAR
After seeing coiling action for most of last week, sugar’s upsurge on Friday lifted prices back above their 50-day moving average for the first time since mid-August. While key outside markets are providing carryover support, sugar is also receiving bullish supply news that can help sugar maintain upside momentum through month-end.
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.
