Rains Help Coffee Crops
With Brazil’s 2020/21 harvest complete, a shift in focus toward upcoming production in Brazil and Colombia may help the coffee market extend its recovery move. For the week, December coffee finished with a gain of 2.60 cents (up 2.4%) which was a second positive weekly result over the past 3 weeks. The prospect that a La Nina weather event will keep Brazil’s major Arabica growing regions drier than normal provided significant support to coffee prices as their 2021/22 “off-year” crop was already expected to have a sharp decline from this season’s near-record high total.
Cocoa prices finished last week on a downbeat note in spite of stronger key outside markets as global demand concerns remain a front-and-center issue for the market, and the short-term weather carried a bearish tilt. Critical demand-side data late this week could be a source of pressure over the next few sessions.
With new highs for the fourth session in a row, traders are clearly concerned over significant hurricane damage from the recent heavy rains in the US. This, along with a sense of strong demand has helped to keep the market in a steady uptrend. Production fears may peak soon with the supply/demand report and the expected impact of Hurricane Delta to US Gulf coast.
Sugar prices continue to maintain upside momentum as they have been supported by a bullish shift in Brazilian weather conditions. March sugar reached a new 7-month high before finishing Friday’s outside-day trading session with a moderate gain.
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