Cocoa Demand Tone Weak
In spite of carryover support from key outside markets and bullish supply-side developments, cocoa has been unable to sustain an upside move since reaching a multi-year high early this month. With near-term demand remaining a front-and-center issue for the market, cocoa prices could remain choppy.
Coffee prices have sustained upside momentum for 2 sessions in a row and are on-track for a positive weekly reversal. With global demand concerns starting to ease, a bullish longer-term supply outlook can help the coffee market extend this recovery move.
December cotton rallied sharply yesterday, and in the process recovered all its losses from the selloff on Monday. The stock market was up as well and managed to recover all its losses from Monday that occurred in the wake of the Evergrande debacle, and that was supportive to economically sensitive markets like cotton.
The sugar market has regained upside momentum and is now on-track for a positive weekly reversal. If key outside markets and global risk sentiment remain positive, sugar should be able to remain in a short-term uptrend.
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