ADMIS News
COCOA
Cocoa’s abrupt turnaround during Thursday’s trading has put the market on-track for a third positive weekly result over the past 4 weeks, as well as a positive weekly reversal. While it will be unlikely to fully overcome demand concerns for a while, cocoa prices continue to show signs that the mid-July low will become a longer-term low for the market.
COFFEE
After starting the week and month with an outside-day down close from a 3 1/2 week high, coffee is back on-track for a third positive weekly result in a row. With the market continuing to receive bullish supply news, coffee can extend this week’s recovery move above and beyond the 50-day and 100-day moving averages. Colombia’s July coffee production came in at 944,000 bags, which was 22% below last year’s total and the sixth month out of 7 so far that came in below the comparable 2021 reading.
COTTON
December cotton closed slightly higher on Thursday after earlier trading to its lowest level since Tuesday. The dollar was weaker, and the stock market and crude oil were higher, all of which lent support. The trade appears to be consolidating ahead of next week’s USDA supply/demand report, as expectations for a poor US crop go against fears of lower demand. The weekly US Drought Monitor showed a mix of results last week, with improvement in some areas but permanent damage in others. Meanwhile, short-term drying combined with above-normal temperatures to worsen drought conditions across some other parts of Texas and Oklahoma.
SUGAR
Sugar prices have been unable to lift clear of their recent consolidation zone as they continue to be pressured by sluggish outside markets. Until energy prices can regain their strength, the sugar market may remain under pressure. Crude oil prices have lost over $6 a barrel while RBOB gasoline prices have fallen more than 25 cents a gallon during the past 2 sessions, which put considerable carryover pressure on sugar prices.
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