ADMIS News
COCOA
Although global risk sentiment continues to see severe changes in tone, cocoa’s bullish supply/demand outlook should keep the market well supported on near-term pullbacks. There has been a gradual shift towards wetter weather over many West African growing areas as the region’s “dry” season starts to wind down, and that may have fueled profit-taking. A rebound in the Eurocurrency provided an early boost to cocoa prices as it may help to improve near-term demand prospects in Europe.
COFFEE
Following Friday’s reversal, coffee prices have put together 3 positive daily results in a row and are more than 12.00 cents above their January and March lows. While it may face pressure from sluggish global risk sentiment, coffee’s bullish supply outlook can help the market maintain upside momentum. A bullish supply outlook for Brazil and Colombia has underpinned coffee prices, as both nations could have weather issues from the current La Nina event.
COTTON
May cotton closed higher yesterday after spending the day inside Monday’s range. Outside market forces were mixed- the dollar was lower, which is supportive, but so were the stock market and crude oil, which is negative. The market is trying to follow the stock market higher today, but traders could struggle with the idea that demand expectations will remain high.
SUGAR
Sugar prices were able to find their footing again yesterday, due in large part to renewed strength in key outside markets. While it is likely to have a bumpy ride, supply/demand factors can help the sugar market avoid a sizable near-term pullback. A sizable rebound in energy prices provided carryover support for the sugar market as crude oil and RBOB gasoline prices close to multi-decade highs should give a significant boost to global ethanol demand.
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