USDA Update Positive Tilt For Cotton
Cocoa prices remain near the lower portion of their 2021 trading range as they continue to be weighed down by near-term demand concerns. Increased COVID vaccine usage around the globe should further strengthen a positive longer-term demand outlook, so the cocoa market should be close to a near-term low.
Coffee prices are seeing tightening coiling action within their June consolidation zone as they continue to hold their ground above last week’s low. Consolidation is normally a continuation pattern.
December cotton experienced a new contract high close after the USDA report. The market sold off immediately after the release of the monthly USDA supply/demand report, as traders were apparently disappointed that 2021/22 production was left unchanged given the problems with the weather in west Texas. But upon closer examination the report was viewed as supportive, with exports and ending stocks both coming in at the bullish end of expectations.
Sugar prices have seen tight coiling price action in spite of strength in key outside markets as they have held below last week’s high so far this week. A potentially bullish supply outlook should help sugar remain fairly well supported on a near-term pullback.
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