ADMIS News
COCOA
Cocoa has seen coiling price action this week as the market remains at the top end of its December recovery move. While there are mixed signals on near-term demand prospects, cocoa has bullish supply developments that should keep prices well clear of last week’s lows. Indications that the UK may impose fresh COVID lockdown measures weakened the cocoa market as it may diminish near-term European demand prospects.
COFFEE
Coffee prices were able to avoid downside follow-through from Tuesday’s key reversal as the market continues to find support from bullish supply factors. There may be new questions over near-term demand prospects, however, and that leaves coffee vulnerable to a further pullback. The Brazilian currency gained more than 1% in value and reached a 2 1/2 week high, which provided carryover support for the coffee market as that should ease pressure on Brazil’s farmers to market their remaining supply from the 2021/22 Arabica crop.
COTTON
March cotton closed higher yesterday after trading sharply lower overnight. The dollar was sharply lower, which lent some support to cotton. Over the past two sessions, the market has consolidated inside Monday’s range up day as traders have grown cautious ahead the USDA supply/demand report for today. For the report, the average trade expectation for US 2021/22 cotton ending stocks is 3.51 million bales (range 3.20-3.70 million), up from 3.40 million in November’s report.
SUGAR
Sugar prices continue to follow-through on last Thursday’s positive reversal from a 4 1/2 month low as they have climbed back above the 50-day and 100-day moving averages for the first time since late November. While it has found significant carryover support from key outside markets, sugar has also been strengthened by a bullish Brazilian supply outlook.
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