ADMIS News
COCOA
Demand concerns have not been soothed and have kept the market on the defensive. Although prices are now looking cheap, cocoa may need to see clearer signs of an improved demand outlook before it can sustain upside momentum again. Reports of increasing coronavirus cases in the US, Germany and China clearly cast a shadow over cocoa’s global demand prospects as they diminished the chances that chocolate consumption levels will have significant improvement during the third quarter.
COFFEE
While there was no single catalyst for coffee’s rebound, the market is on-track for a positive weekly key reversal. While bullish supply developments should provide underlying support, coffee will require clear signs that global demand is on the mend before it can make an extended recovery move. Global demand remains a sore spot for the market, and reports of increased coronavirus cases in the US and Europe will weigh on prices as those flare-ups will push back restaurant and retail shop reopening further into the future.
COTTON
December cotton has been able to hold key uptrend channel support on a closing basis and the market has now seen higher trade for the last two sessions. The market may have been encouraged after Trade Representative Robert Lighthizer told Congress that China had purchased about $1 billion of US cotton since the Phase 1 trade deal took effect in February.
SUGAR
The market has seen an 8-session consolidation and appears to be probing for a short-term top. Key outside markets are having trouble maintaining upside momentum while global risk sentiment remains subdued, and that could make it difficult for sugar to see more up. A pullback in crude oil prices was an early source of headwinds for sugar as it weakened the prospects for a rebound in Brazilian ethanol demand.
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