Brazil Sugar Production Lower Than Expected
Cocoa prices have been unable to climb above last Thursday’s 3 1/2 week high for 3 sessions in a row, and may be vulnerable to pre-holiday profit-taking and additional long liquidation. The market continues to have improving global demand and bullish supply developments, however, and that should help cocoa to remain fairly well supported on a near-term pullback.
After several sessions of coiling price action, coffee regained strong upside momentum and has risen to a new 10-year high. With sizable gains for the month and quarter going into thin holiday trading conditions, coffee remains vulnerable to increased volatility.
March cotton closed moderately lower yesterday, as it continued its consolidation pattern. The dollar made a new high for the move and apparently kept a lid on the cotton market.
While there have been bearish supply developments from Thailand and recent volatility in key outside markets, sugar continues to be underpinned by a bullish supply outlook. Brazil production lower than expected. With fresh developments in Brazil strengthening the case for a global supply deficit, sugar may extend a recovery move towards a retest of last week’s highs.
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