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Sharp Drop in Brazil Output Supports Coffee


The cocoa market finished last week by following through on Monday’s wide-sweeping outside day higher. Although global demand prospects will remain a concern well into 2021, the market can extend this recovery move into year-end.


Coffee was able to shake off last Monday’s washout and will start the final trading week of 2020 in close proximity to 3 1/2 month highs. While demand continues to be diminished by COVID shutdowns, coffee has several supply issues that can help the market maintain upside momentum through year-end.


Cotton prices are on-track for a seventh positive monthly result in a row and are near 20-month highs. While the market was able to bounce back from last week’s pullback, it may not be as resilient going into final trading week of the year.


Sugar is on track for an eighth monthly and third quarterly gain in row. This would normally leave the market vulnerable to long liquidation during the final trading week of the year. Sugar prices were able to maintain upside momentum going into the holiday weekend, and they can benefit from a near term bullish supply setup today.

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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