Sluggish Global Demand For Coffee
Cocoa continues to have a difficult time overcoming global demand concerns as the market has fallen 150 points (down 6.2%) over the past week. While there has not been consistent carryover support from key outside markets, global risk sentiment appears to be on the mend. Global risk sentiment was given a solid boost by strong readings for US retail sales and Euro zone economic sentiment, which was a critical factor in cocoa’s positive daily result as it helped to soothe market concern with near-term global demand prospects.
Coffee continues to be pressured by a bearish global supply outlook and a lukewarm to sluggish global demand outlook. While prices will start today very close to Monday’s contract low, they are less than 3 cents down for the month of June so far. September coffee closed lower for a sixth negative daily result in a row.
December cotton closed higher for the first time in four sessions as bullish outside market forces helped to provide some temporary support. The market drew some support from a strong stock market and from stronger than expected retail sales figures, which bode well for cotton demand.
Sugar has been unable to climb above its recent consolidation zone in spite of stronger risk appetites and several favorable outside markets. The market has been showing signs of being “top-heavy” since last week, and remains vulnerable to a near-term pullback.
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