Texas Hot Forecast
The cotton market has been drawing support from the hot and dry conditions in west Texas, but we question whether some additional damage to the crop there will offset the bearish developments from last week’s USDA reports. US 2020/21 ending stocks are now projected at 7.6 million bales, which is the highest they have been since the 2007/08 marketing year.
Cocoa’s abrupt change in fortune on Friday may be symptomatic of its overbought status, but it also reflects the impact of sluggish global risk sentiment on its near-term prospects. While bullish supply developments provide some support, the market may see early downside action this week until stronger risk appetites emerge.
December coffee pushed lower overnight, through last Friday’s lows, yet it comes into the week well above last Tuesday’s 3-week low. It finished last week with a loss of 1.45 cents (down 1.2%) which was a second negative weekly result in a row.
October sugar broke out above its August consolidation zone last week on bullish supply news. However, the market remains on track for a large production surplus for 2020/21 and may be starting to get top heavy.
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.