ADMIS News
COCOA
The cocoa market was caught up in the deflationary washout yesterday, but it was already facing several bearish factors. Prices have fallen well into bargain territory, which could attract some commercial interest and possibly short covering. Fund traders have crossed into net short territory, and the selling trend is bearish. September cocoa fell to its lowest level since November on Tuesday and followed that with some mild weakness overnight.
COFFEE
Coffee prices have fallen more than 10% from last Thursday’s high, as the market has seen an abrupt change in tone since the start of the month. And while it may still have a bullish long-term supply/demand setup, it could remain on the defensive this week if the risk-off mood persists. September coffee had another range down move on Tuesday and fell to its lowest level since mid-May.
COTTON
The weekly crop conditions report showed the US cotton crop was unchanged from the previous week. This could make recent longs nervous that the talk of excessive rainfall in the southeast will not damage the crop enough to justify December cotton’s move to its highest level since February 25 on Tuesday. Cotton traded in a wide range on Tuesday, selling off after an initial rally.
SUGAR
Sugar prices lost momentum before they could retest last Thursday’s high, with a technical reversal yesterday that could put the bulls on the defensive. The market has drawn some mild support from a modest recovery in crude prices overnight, and sugar’s fate may be determined by energy markets for the time being. A broad-based, post-holiday deflationary selloff in commodities led to significant long liquidation.
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