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Large Global Demand For Cotton


Cocoa prices were unable to follow through on Monday’s daily reversal as they were pressured by key outside markets. While the near-term supply outlook remains uncertain, cocoa should benefit from steady improvement in global demand and hold its ground above Monday’s low.


Coffee prices continue to see coiling action that has respected both the mid-October lows and its 50-day moving average. With bullish supply developments and improving global demand providing underlying support, coffee may be setting the stage for a sizable upside move fairly soon.


The USDA report came in bearish for the US numbers and bullish for the world number, and the cotton market seemed to take its directions from the world numbers. December cotton closed sharply higher after trading to its highest level since the contract high day of November 2. From the USDA report, US 2021/22 cotton production came in at 18.20 million bales, up from 18.00 million in the October report and above the average expectation of 18.04 million.


Sugar prices may have lost upside momentum, but they have closed above their 50-day moving average for 3 sessions in a row for the first time since early October. If key outside markets remain strong, sugar can extend its November recovery move to a new 4-week high.

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.

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