ADMIS News
SUGAR
Sugar prices have recovered this week despite sluggish global risk sentiment and weakness in its key outside markets, as traders have been reminded of the tight global supply. Expectations that India and Thailand will see production decreases this season were reinforced this week from the USDA Foreign Ag Service, which forecast a 15% decline in Thai production and a supply deficit for India. Reports that Philippines and Egypt could be importing sugar over the next few months has also supported the market. There is rain in the forecast this weekend and late next week for Brazil’s main cane-growing regions, which could cause delays in harvest and crushing.
COFFEE
Coffee continued to drift lower overnight, with the December contract falling below the January low to its lowest level since early 2021. There are concerns that restaurant and retail shop consumption could be weakened by a shaky economy, and coffee traders will be watching outside markets today to see their reaction to the monthly US jobs report. Brazil’s production increases for the current season continue to weigh on prices, as their increased output will offset expected lower production in Colombia and Central America.
COTTON
December cotton remains stuck in a range, as it finds support from a poor US crop outlook but is pressured by diminishing demand expectations. The market could follow the equity and crude oil markets today as they react to the US jobs report. Cotton saw initial support from the strong US export sales report yesterday, but that did not hold. Australia experienced its driest September on record, and areas with severe moisture deficiency are expanding.
COCOA
The cocoa market’s inability to sustain upside momentum over the past three weeks has been due in part to the start of the 2023/24 season on October 1, but the long-term supply outlook remains bullish. Producers had been holding back until the start of the new season. Heavy rainfall late in the growing cycle has contributed to lower production out of west Africa. El Nino threatens to bring dry conditions to the region, which could lower production later this season.
Interested in more futures markets? Explore our Market Dashboards here.
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.
