Investing.com - U.S. soft futures were mostly higher during U.S. morning trade on Monday, with coffee and sugar prices climbing on the back of a bout of technical buying amid speculation prices may have bottomed.
Some fund-related buying also provided support. Wall Street investment bank Morgan Stanley said in a report earlier that index funds probably will buy 11,148 lots of Arabica coffee and 31,451 contracts of raw sugar as the Standard & Poor’s GSCI and Dow Jones-UBS Commodity Index re-balance.
Morgan Stanley added that market players will probably add 4,690 contracts of cotton. Changes to weightings start today.
On the ICE Futures U.S. Exchange, Arabica coffee for March delivery traded at USD1.4853 a pound, up 1.2% on the day. The March contract rose by as much as 1.3% earlier in the day to hit a session high of USD1.4872 a pound.
Arabica futures rallied to a three-week high of USD1.5182 a pound on January 3.
Coffee prices tumbled to USD1.4127 on December 31, the lowest level since June 2010, amid concerns global supplies of the bean are more than ample to meet demand.
Bullish speculators are now closing out bets on lower prices after Arabica fell nearly 37% last year, the most in 12 years, making it one of the worst performing commodities of 2012.
Meanwhile, sugar futures for March delivery traded at USD0.1902 a pound, gaining 0.8% on the day. The March contract rose by as much as 0.9% earlier to hit a daily high of USD0.1904 a pound.
Sugar futures touched a four-week high of USD0.1974 a pound on January 3.
March sugar prices have rallied nearly 4% since hitting a two-and-a-half-year low of USD0.1830 a pound on December 13, as market players closed out bets that prices would fall further after futures moved into oversold territory.
Elsewhere, cotton futures for March delivery traded at USD0.7478 a pound, down 0.4% on the day. The March contract fell by as much as 0.6% earlier in the session to hit a daily low of USD0.7465 a pound.
Cotton futures fell to a three-week low on Friday, after China’s National Development and Reform Commission said it planned to release cotton in its state reserves to meet demand from the domestic textile industry.
However, the NDRC didn't give any details as to how much cotton would be released, or when.
Releasing cotton from its reserves could mean fewer imports and less demand for U.S. cotton. China is both the world's largest producer and consumer of the fiber.
Some fund-related buying also provided support. Wall Street investment bank Morgan Stanley said in a report earlier that index funds probably will buy 11,148 lots of Arabica coffee and 31,451 contracts of raw sugar as the Standard & Poor’s GSCI and Dow Jones-UBS Commodity Index re-balance.
Morgan Stanley added that market players will probably add 4,690 contracts of cotton. Changes to weightings start today.
On the ICE Futures U.S. Exchange, Arabica coffee for March delivery traded at USD1.4853 a pound, up 1.2% on the day. The March contract rose by as much as 1.3% earlier in the day to hit a session high of USD1.4872 a pound.
Arabica futures rallied to a three-week high of USD1.5182 a pound on January 3.
Coffee prices tumbled to USD1.4127 on December 31, the lowest level since June 2010, amid concerns global supplies of the bean are more than ample to meet demand.
Bullish speculators are now closing out bets on lower prices after Arabica fell nearly 37% last year, the most in 12 years, making it one of the worst performing commodities of 2012.
Meanwhile, sugar futures for March delivery traded at USD0.1902 a pound, gaining 0.8% on the day. The March contract rose by as much as 0.9% earlier to hit a daily high of USD0.1904 a pound.
Sugar futures touched a four-week high of USD0.1974 a pound on January 3.
March sugar prices have rallied nearly 4% since hitting a two-and-a-half-year low of USD0.1830 a pound on December 13, as market players closed out bets that prices would fall further after futures moved into oversold territory.
Elsewhere, cotton futures for March delivery traded at USD0.7478 a pound, down 0.4% on the day. The March contract fell by as much as 0.6% earlier in the session to hit a daily low of USD0.7465 a pound.
Cotton futures fell to a three-week low on Friday, after China’s National Development and Reform Commission said it planned to release cotton in its state reserves to meet demand from the domestic textile industry.
However, the NDRC didn't give any details as to how much cotton would be released, or when.
Releasing cotton from its reserves could mean fewer imports and less demand for U.S. cotton. China is both the world's largest producer and consumer of the fiber.