ADMIS News
COCOA
Cocoa prices will begin today’s action unchanged for the holiday-shortened week, but nearly 90 points above last week’s multi-year low. If global risk sentiment can go into the weekend on an upbeat note, cocoa should be able to regain upside momentum.
COFFEE
While coffee will start today’s trading on-track for a positive weekly result, the market has fallen back from Wednesday’s 1 1/2 week high. With bullish supply news and a positive turnaround in global risk sentiment, coffee may be able to finish the week on an upbeat note. The USDA estimated Brazil’s 2022/23 Arabica production will increase 5.1 million bags up to 41.5 million, which is well above many current trade forecasts and Brazilian government estimates.
COTTON
December cotton sold off sharply for the third session in a row on Thursday, trading to their lowest level since March 15. Over the past three sessions, the market has declined 16.78 cents/pound or 14%. The market has seen heavy long liquidation this week as traders have become more fearful of a recession. Comments by Fed Chairman Powell that the Fed is not trying to engineer a recession to stop inflation, but is fully committed to bringing prices under control even if it risks an economic downturn added to these concerns. The trade is also concerned that a US ban on imports from China’s Xinjiang region will spark a retaliation by China to stop importing US cotton. China has been the biggest buyer of US cotton so far for the 2021/22 marketing year.
SUGAR
Sugar prices are being pressured by sluggish key outside markets and from a bearish shift in recent supply/demand news. This has sparked long liquidation selling from speculators. Until there is significant further improvement in global risk sentiment, sugar is likely to remain on the defensive. October sugar broke out to the downside as it reached a new 3 1/2 month low.
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