Consolidation Trade in Coffee
Cocoa was unable to benefit from the “risk on” mood seen in many commodities early this week as it continues to be weighed down by near-term global demand concerns.
Coffee prices extended the late January pullback as they continue to face pressure from near-term demand concerns, particularly in Europe. Although global demand should remain subdued through the first quarter, coffee has had recent bullish supply developments that can help prices find their footing.
The market appears to have put in a short-term peak with the action overnight with May cotton moving down to a 4-session low.
A positive demand outlook has underpinned prices relatively close to last Tuesday’s multi-year high, but sugar may need consistent strength from key outside markets to sustain upside momentum.
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