Cotton candy prices saw a sweet gain of 0.76% today, settling at 55,660. This rebound comes after facing pressure from a dip in world consumption forecasts for the season. The expected 1.3 million bale drop is blamed on lower demand from India, Indonesia, and other key players.
However, a surprise surge in world-ending stocks, up by 2 million bales, provided much-needed support. This boost was driven by higher production and beginning stocks, partially offsetting the consumption slowdown.
India's cotton association held steady on its domestic consumption and pressing estimates for the season. Meanwhile, Brazil's historic cotton production in 2023 added to the global supply glut.
Despite this abundance, sluggish demand and economic woes kept a lid on prices. However, a decline in pink bollworm infestation in India's cotton crop offered some hope.
Technically, the market saw short covering, with open interest unchanged. Cotton candy is finding support at 55,300, with potential downside to 54,950. Resistance lies at 55,900, with a possible climb to 56,150.
In short, cotton candy prices enjoyed a temporary reprieve amidst a challenging global market. Whether this sweetness lasts depends on how demand plays out in the coming months.
