Coffee, Cocoa and Sugar: March coffee closed at $2.4905 per pound, down 25 points after achieving 13 year highs. Concern that coffee stockpiles declined in producing countries continues to prompt bullish ideas but we prefer the sidelines awaiting a correction before reassessing this market. March cocoa closed at $3250 per tonne, down $1.00 and is consolidating on a technical basis. Recent rallies were prompted by Ivory coast’s President-elect banning exports for a month while the disputed election is being determined. We do not engage in trading markets with geopolitical implications. March sugar closed at 32.64c per pound, up 6 points and made a new 30 year high. The sugar cane in Australia was damaged and output had already been cut by 21% from previous flood damage. Australia is the third largest sugar producer and the projected shortages could prompt additional buying in sugar. We like sugar but only on setbacks and with stop protection.
Cotton: March cotton closed down the 4c limit for the second day in a row closing at 16786 after making a 140 year high during the Thursday session. The start of the Chinese lunar year impacted trading in advance of the annual survey of cotton planting intentions by the National Cotton Council. We will await that report before commenting further.
John L. Caiazzo
Information provided is from sources deemed to be reliable but not guaranteed. Futures and Options trading involve a high degree of risk and may not be suitable for everyone. John Caiazzo is a registered commodities broker with over 40 years experience in investments and opinions are his own and not of the Futures Commission Merchant to which he introduces his clients.