Jack Scoville
About The Author

Jack Scoville

Jack Scoville is an often quoted market analyst in the grain and soft commodities sectors. You will find his commentary throughout the Reuters, Wall Street Journal, Dow Jones, Bloomberg, and Barron's publications. Contact Mr. Scoville at (312) 264-4322

Price Group Estimates of Major U.S. Planting Levels*
USDA Ag Forum Price Change
15/16 16/17 17/18 E- 17/18 vs. 2015/16

Corn 88.00 94.00 90.00 90.28 -3.724
Beans 82.65 83.43 88.00 88.30 4.867
Sprg Wht 13.37 11.61 11.52 11.35 -0.255
Durum 1.95 2.41 2.10 2.08 -0.337
Winter 39.68 36.14 32.38 32.33 -3.807
All Wheat 55.00 50.15 46.00 45.76 -4.394
Oats# 3.09 2.83 2.75 2.92 0.092
Barley# 3.62 3.05 2.85 2.90 -0.152
Sorghum# 8.46 6.69 6.10 6.30 -0.390
All Cotton 8.58 10.07 11.50 11.45 1.376
Rice 2.63 3.15 2.60 2.65 -0.500
Total 252.02 253.39 249.80 250.56 -2.83
* millions of acres #AG F 11.7 mln aggrete for these crops

COTTON
General Comments: Cotton futures closed lower despite a solid USDA export sales report. The USDA reports today will likely show the potential for a big US crop and that has proven to be more important than the current situation this week. Export demand has remained strong and much stronger than expected by just about everyone. Unexpected buying by China has supplemented strong buying by Southeast Asia and the Middle East. Buying is also seen from India and Pakistan to cover short term needs after reduced crops last year. These two countries are now said to be looking at Australian Cotton for further imports. The USDA plantings intentions reports that could show a sharp increase in Cotton planted area. USDA had projected area at about 11.5 million acres in February, but some analysts look for area as high as 12 million acres due to the recent price strength. The average trade guess released by Reuters last week was just under 11.5 million acres. Cotton remains mostly a demand story as US export demand has been strong and US mills have yet to price a lot of on call purchases. Ideas that US buyers have a large amount of Cotton bought but unpriced also supported futures. These buyers will need to buy futures sooner or later to fix prices, and the number of contracts open through July is big.
Overnight News: The Delta and Southeast should get chances for showers and rains every few days, with best amounts and coverage on today and tomorrow and Sunday. Temperatures should will average above normal after a below normal day today. Texas will see chances for light showers through the weekend, although some western areas will stay mostly dry. Temperatures will be above normal. The USDA average price is now 73.21 ct/lb. ICE certified stocks are now 322,789 bales, from 321,350 bales yesterday.
Chart Trends: Trends in Cotton are mixed to down with objectives of 7570, 7510, and 7420 May. Support is at 7600, 7550, and 7510 May, with resistance of 7720, 7820, and 7860 May.

FCOJ
General Comments: FCOJ closed lower. The market has collapsed and now is probing for a low. Domestic US production remains very low due to the greening disease and drought. Florida remains very dry. Trees are in bloom in all areas of the state, and petals are starting to drop in some areas as fruit is forming. Good rains are needed for the bloom and initial fruit development. Irrigation is being heavily used to prevent loss. There have been some showers reported in the last couple of weeks, but more is wanted. The harvest has been very active. Early and Mid Oranges are moving mostly to processors. The Valencia harvest is moving to processors and into the fresh market. Major freezes in southern Europe this Winter have damaged the citrus production. Brazil crops remain in mostly good condition.
Overnight News: Florida should see dry weather and mostly below normal temperatures. Brazil should get episodes of scattered showers and near normal temperatures.
Chart Trends: Trends in FCOJ are down with objectives of 156.00 and 152.00 May. Support is at 159.00, 157.00, and 154.00 May, with resistance at 170.00, 173.00, and 176.00 May.

COFFEE
General Comments: New York and London both closed little changed. The charts show that the market is trying to form a low once again after failing to hold in trading last week. There is no business being done in the physical market at these levels, or at least not enough for the demand, and roasters remain the best buyers in futures. Ideas are that Robusta supplies are tight once again, and London has better chart patterns to promote a rally than New York. The cash market in Central America remains quiet, with little buying interest against moderate selling interest. Offers are less from El Salvador, Nicaragua, and Costa Rica, but good volumes are available from Honduras and Guatemala. Peru is also said to be offering good volumes, but the flooding there might be interrupting shipments as it has life in general. Vietnamese prices are now at or near record highs, and there does not seem to be much Robusta around from other sources, with both Brazil and Indonesia mostly out of the market.
Overnight News: Certified stocks are higher today and are about 1.352 million bags. The ICO composite price is now 132.93 ct/lb. Brazil will get mostly dry weather. Temperatures should average near to below normal this week and near to above normal this weekend. Colombia should get scattered to isolated showers. Central America and southern Mexico should get mostly dry conditions. Temperatures should average near to above normal.
Chart Trends: Trends in New York are down with objectives of 137.00, 130.00, and 126.00 May. Support is at 135.00, 132.00, and 129.00 May, and resistance is at 140.00, 144.00 and 147.00 May. Trends in London are mixed. Support is at 2140, 2120, and 2090 May, and resistance is at 2200, 2230, and 2260 May.

SUGAR
General Comments: New York and London closed lower, with London showing the most weakness. The short term trend direction remains down, and another attempt to make new lows is probably coming. Wire reports indicate that Brazil producers joined speculators as the best sellers. The cyclone in Australia has damaged Sugarcane crops in Queensland, but damage estimate3s are pending The market is no longer appears concerned about near term supply tightness because of less than expected demand. India especially has been out of the market. It had been expected to be a strong buyer due to reduced sugarcane production last year due to the neven monsoon. The world situation would imply that production can recover after El Nino induced losses last year. However, there are indications that El Nino could return, and smaller crops might be produced in India once again. The weather service there is looking for a normal monsoon. Brazil could also have better crops this year as rains have been good in Center South areas. It remains much drier than normal in the Northeast. Southeast Asia has good growing conditions.
Overnight News: Brazil will get mostly dry weather. Temperatures should average near below normal this week and near to to above normal this weekend.
Chart Trends: Trends in New York are down with objectives of 1640 and 1570 May. Support is at 1650, 1620, and 1590 May, and resistance is at 1700, 1750, and 1800 May. Trends in London are down with objectives of 475.00 and 450.00 May. Support is at 475.00, 472.00, and 469.00 May, and resistance is at 494.00, 497.00, and 503.00 May.

COCOA
General Comments: Futures markets closed mixed, with London a little lower and New York a little higher. Ivory Coast cut the guaranteed price to farmers by 36% yesterday, but also cut export taxes. The move is mostly an acknowledgement that the futures and cash market has collapsed in the last few months. But, it highlights the situation that producers worldwide are facing. Supplies still appear to be increasing but demand remains weak. The production this year could be a record in Ivory Coast and is above last year in Ghana, although not a record. Both countries are experiencing moderate weather at this point in the dry season, with some showers now and without the extreme heat or Harmattan winds. Demand has been weak, but might start to improve soon as prices for Cocoa and products have turned much lower. Mostly good conditions are reported in Southeast Asia, but some producers have switched to other crops such as pepper as these producers look for better returns on their investments and work.
Overnight News: Mostly dry conditions are expected in West Africa, but some showers are possible. Temperatures will average near to above normal. Malaysia and Indonesia should see scattered showers in all areas. Temperatures should average near normal. Brazil will get mostly dry conditions or light showers and near to above normal temperatures. ICE certified stocks are higher today at 4.779 million bags.
Chart Trends: Trends in New York are mixed to down with objectives of 2000 and 1830 May. Support is at 2060, 2040, and 2000 May, with resistance at 2120, 2190, and 2220 May. Trends in London are mixed to down with objectives of 1660 and 1610 May. Support is at 1660, 1630, and 1620 May, with resistance at 1730, 1760, and 1790 May.

 

Questions? Ask Jack Scoville today at 312-264-4322

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