ADMIS News
COCOA
With near-term demand prospects weakened by negative quarterly grindings results from Asia and North America, cocoa received some badly-needed carryover support from key outside markets. Although the market remains on-course for a sizable monthly decline, cocoa looks to be finishing April on a modestly upbeat note. A positive turnaround in European and US equity markets provided carryover support to cocoa prices as that can help to soothe near-term demand concerns in both regions.
COFFEE
Coffee’s inability to sustain upside momentum has left the market vulnerable to additional long liquidation. With May, July and September coffee all trading below their 200-day moving average for the first time in the life of their contracts, coffee may have a downbeat finish to April. Continued weakness in the Brazilian currency put carryover pressure on the coffee market, as a nearly 7% loss in value over the past 4 sessions may rattle Brazil’s farmers, and make them more aggressive with marketing their near-term supply to foreign customers.
COTTON
The market experienced a big turnaround in cotton prices yesterday with the July futures trading to limit up levels. The market is seeing strong gains early today. Drought concerns persist for west Texas, which is the largest producing area in the US. According to the US Drought Monitor, the region is experiencing drought levels categorized as “extreme” to “exceptional,” which is the worst condition possible. Talk of export ban from India helps spark more buying.
SUGAR
Sugar prices have fallen back below their 50-day moving average and with two sessions left in April are on-track for a negative monthly key reversal. With the market still holding a sizable net spec long position in the latest COT report, sugar is vulnerable to additional long liquidation. A rally in RBOB gasoline prices to a new 7-week high provided sugar with early carryover support as that can help to strengthen near-term ethanol demand.
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