ADMIS News
COCOA
Outside market forces sour and demand tone weakens. While the negative shift in global risk sentiment leaves the market vulnerable to profit-taking and some long liquidation, cocoa looks to be on-track for a second sizable weekly gain in a row. Indications that major West African producers will see their 2021/22 output decline from last season’s levels continue to underpin cocoa prices this month.
COFFEE
The key reversal may spark a short-term correction at least. A more than 1% rally to a 4-month high in the Brazilian currency provided coffee with early carryover support, as extended strength in that currency will ease pressure on Brazil’s farmers to market their remaining near-term supply.
COTTON
May cotton closed lower on the session yesterday and near the bottom of the consolidation of the past week. However, the market managed to hold at the key uptrend channel support at 122.70. Outside market forces were negative, with the dollar sharply higher and the stock market lower in the wake of the release of a hot CPI number. Traders may have also been a bit disappointed with the weekly export sales report, which was down sharply from the previous week’s exceptionally large number.
SUGAR
While a negative shift in global risk sentiment may weigh on prices, recent bullish supply/demand developments can help support. Stronger energy prices and a new 5-month high in the Brazilian currency were both sources of carryover support to the sugar market, as that combination encourages mills to shift more of their crushing over to ethanol production.
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