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Cotton Rallied Sharply

Cocoa’s demand issues are not fully extinguished yet, but global demand appears to be more resilient than expected through coronavirus restrictions. With bullish supply developments providing added support, cocoa can extend its upside breakout move.

Coffee still has a very large (and likely record high) Brazilian crop to contend with, but bullish supply news helped to put some brakes on its downside breakout. In order to sustain upside momentum, coffee will need to receive positive news from the demand side of the market.

July cotton rallied sharply yesterday, reversing last week’s selloff and trading to its highest level since March 16. Dry weather in US growing areas, particularly Texas, is raising some concern about their crop.

Sugar continues to hold its ground within its recent consolidation. Even so, bearish supply continues to weigh on sugar prices and leaves them vulnerable to a near-term pullback.

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