Brazilian Sugar Production Down
Cocoa prices finally ran out of upside momentum, but not before climbing 200 points (and nearly 8% in value) above their September 1st low. Cocoa has a bullish longer-term supply/demand outlook that can help the market find its footing.
Coffee prices have been unable to find their footing during September so far. The Brazilian currency lost more than 2.5% in value and reached a 2-week low, which became a major source of carryover pressure on the coffee market yesterday.
The market rallied to the highest level since August 16th yesterday but closed well off of the highs. The dollar was up sharply for the second straight day after putting in a 5-week low last week, and this undercut cotton. The possibility of another storm developing over the Gulf of Mexico that could threaten a maturing crop lent some support to cotton early.
Sugar prices remain in a short-term downtrend off of the August 31st peak. The market continues to be pressured by sluggish outside markets and lukewarm global risk sentiment. However, sugar prices have bullish supply developments in Brazil that are providing underlying support.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.