ADMIS News
COCOA
Cocoa prices have faced headwinds from near-term demand concerns for more than 2 years now, but today’s European quarterly grindings data will provide some evidence of how Russia’s invasion of Ukraine has impacted chocolate consumption in the region. Europe’s first quarter cocoa grind rose 4.4% from a year ago to 373,498 tons. German first quarter grind was up 7.1% on the year to 98,018 tons. This is back to a level seen before the pandemic. The data is positive against trade expectations as there were fears of sluggish demand.
COFFEE
In spite of a positive shift in global risk sentiment, coffee prices have dropped sharply over the past two sessions down to the bottom portion of their April consolidation. Recent strength in the Brazilian currency provided coffee prices with early carryover support, as that eases pressure on Brazil’s farmers to market their remaining coffee supply before their 2022/23 Arabica begins to be harvested next months.
COTTON
May cotton rallied sharply for the forth session in a row this morning and traded to a new contract high. This was the highest a contract had traded since early July 2011. The dollar was lower yesterday and crude oil and the stock market were higher and all of these moves are bullish for cotton. India has allowed duty-free imports of cotton until September 30 as local prices have reached record high levels because of a drop in production.
SUGAR
Sugar prices continue to receive carryover support from key outside markets, but have had trouble extended the April rally. Unless the market can receive bullish supply news, sugar may be vulnerable to a technical correction. July sugar experienced a key reversal with an outside-day down from an overbought level. Stronger energy prices provided carryover support to the sugar market as that should help to strengthen ethanol demand.
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