Better March Weather For Texas Cotton Acres
Cocoa is widely expected to receive a longer-term demand boost as global economies recover from the pandemic, but the near-term outlook will be vulnerable to COVID setbacks. While a rebound in global risk sentiment may provide some support, cocoa may see further downside action before it can find its footing.
Coffee prices appear to have run out of upside momentum, but the market continues to hold ground above the 50-day moving average. The market experienced a wide-sweeping outside-day session with a moderate loss. A bullish 2021/22 global supply outlook is highlighted by what many analysts expect will be a sizable decline in Brazilian production from this season, and that continues to provide underlying support to the coffee market.
May cotton might need to push through resistance at 89.24 soon or risk some further long liquidation selling. Outside market forces were mixed. The dollar was moderately higher, which is negative for cotton, but the stock market was higher as well with new all-time highs for the Dow again which is supportive. Rainfall across west Texas over the weekend was viewed as beneficial to soil moisture and bearish towards cotton.
Sugar prices have been unable to break out of the March consolidation zone, but they have held above last week’s low in spite of carryover pressure from key outside markets. If global markets can shift back into a “risk on” mood, sugar should be able to regain upside momentum.
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