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
General Comments: Cotton was sharply higher in nearby months and higher in new crop months. New contract highs were made in May. Demand has been strong and merchants have had trouble finding the Cotton in domestic cash markets. Prices overall have been much higher than most commercials had expected. Prices could remain strong until closer to harvest. There have also been quality concerns left over from the hurricanes and the freeze during the growing season. On the other hand, the market expects increased plantings in the western Great Plains due to all of the problems with the Winter Wheat crops in the region. So, buying interest in new crop months is much harder to find.
Overnight News: The Delta and the Southeast will get dry weather for much of the week, but rain is likely on Saturday. Temperatures should be on both sides of normal. Texas will see mostly dry conditions. Temperatures will be warm. The USDA average price is now 82.16 ct/lb. ICE said that certified stocks are now 102,423 bales, from 102,423 bales yesterday. ICE said that 2 notices were posted for delivery and that total deliveries for the month are now 642 contracts.
Chart Trends: Trends in Cotton are ,mixed to up with no objectives. Support is at 8350, 8300, and 8250 May, with resistance of 8560, 8680, and 8800 May.
Wire: Bloomberg News (BN) Date: Mar 5 2018 13:25:00
Cotton Production, Inventory Survey Before USDA WASDE Report
By Dominic Carey
(Bloomberg) — The following table shows results of a Bloomberg News survey
of as many as ten analysts for the USDA’s World Agricultural Supply and Demand
report on the 2017-18 cotton crop, which is scheduled for release at noon in
Washington on March 8. Figures are in millions of bales.
2017-18:| Avg | Low | High | Feb. | 2016-17
US Production | 21.12| 20.70| 21.30| 21.26| 17.17
US Exports | 14.89| 14.50| 15.70| 14.50| 14.92
US End Stocks | 5.48| 4.20| 6.00| 6.00| 2.75
World | | | | |
Production | 120.67| 119.85| 121.10| 121.37| 106.57
World | | | | |
Consumption | 120.60| 120.00| 121.05| 120.50| 114.75
World End | | | | |
Stocks | 87.82| 86.98| 88.05| 88.55| 87.66
| | | End
Estimates: |Production |Exports |Stocks |Production |Consumption |Stocks
Cottonexperts.com | 20.70| 15.70| 4.20| 120.30| 121.05| 86.98
Doane | 21.26| 15.00| 5.50| 121.00| 121.00| 87.50
Love Consulting | 21.26| 14.80| 5.70| 120.80| 120.50| 88.00
Price Futures Group| 21.00| 15.00| 5.50| 121.00| 120.50| 88.00
Rabobank | 21.00| 14.50| 5.70| 121.10| 120.50| 88.00
Rose Consulting | 21.26| 14.50| 6.00| 119.85| 120.50| 88.05
Texas A&M; Robinson| 21.26| 14.60| 5.90|n/a |n/a |n/a
Tullet Prebon | 21.26| 15.00| 5.50|n/a |n/a |n/a
Varner Bros. | 20.85| 15.25| 4.85| 120.80| 120.75| 88.00
Wedbush Securities | 21.30| 14.50| 5.90| 120.50| 120.00| 88.00
General Comments: FCOJ was a little higher. Futures remain in a trading range and Florida remain mostly warm and dry. Trends are starting to turn down on the daily charts, and the market is still dealing with a short crop against weak demand. USDA estimated the crop at about 45 million boxes in its last report, and there does not seem to be any reason to expect a big production increase in its data for the marketing year. The current weather is good as temperatures are warm and it is mostly dry, but the crop is small. The harvest is progressing well and fruit is being delivered to processors and the fresh fruit packers. Trees in Florida are showing fruit of good sizes, and producers are now into the Valencia crop with the early and mid harvest completed. Florida producers are actively harvesting and performing maintenance on land and trees. Some early flowering has been reported in the groves, and some fruit is forming. Irrigation is being used.
Overnight News: Florida should get mostly dry weather and warm temperatures. Some showers are likely on Wednesday. Cool temperatures are likely this weekend. Brazil should get scattered showers and near to below normal temperatures. ICE said that 0 delivery notices were posted today against March Contracts and that total deliveries for the month are 0 contracts.
Chart Trends: Trends in FCOJ are down with objectives of 139.00 and 131.00 May. Support is at 138.00, 136.00, and 135.00 May, with resistance at 143.00, 146.00, and 147.00 May.
General Comments Futures were lower in New York and a Little higher in London yesterday, and daily trends remain sideways in both markets. London has been the weaker market until now as Robusta now seems to be more available in the world market. The funds remain very short, and commercial buying interest in cash markets remains hard to find. They anticipate big crops from Brazil and from Vietnam this year and think that buyers are well covered right now. Other speculators seem interested in buying, but have not found real good reasons to do so. New York traders are noting the good weather currently being reported in Brazil and expect another bumper crop. Increased Vietnamese selling is being seen. The situation seems little changed in Latin America. There are reports of short crops in parts of Central America and some areas in South America due to the lack of farmer investment from the low prices. Honduras has been a very active exporter and offers from most other countries are seen. Differentials in Central America are low and offers are on the table.
Overnight News: Certified stocks are lower today and are about 1.894 million bags. The ICO composite price is now 113.54 ct/lb. Brazil will get chances for showers through mid-week and then will turn drier. Temperatures should be near to above normal through the weekend and near to below normal for the first half of next week. Colombia should get isolated showers. Central America and southern Mexico should get isolated showers or dry conditions. Vietnam will get mostly dry weather, but some storms are possible in the far south. Temperatures should average near to above normal. ICE said that 1 notice was posted for delivery today and that total deliveries are the month are now 1,538 contracts.
Chart Trends: Trends in New York are mixed to down with objectives of 118.00 May. Support is at 119.00, 116.00, and 113.00 May, and resistance is at 124.00, 126.00 and 128.00 May. Trends in London are mixed. Support is at 1730, 1710, and 1680 May, and resistance is at 1780, 1800, and 1830 May.
General Comments: Futures were higher and Price trends are mostly sideways for now. The market is now dealing with the idea that an important low could have seen made in this market. If so, it could mean the end of the major bear market. Futures could drift in a sideways to lower pattern if no bullish news is found, and there is not any around right now. Ideas that Sugar supplies available to the market can increase in the short-term have been key to the selling. India and Brazil are both selling into the world market. Thailand also has a lot of Sugar to sell. Ethanol demand continues strong, although Corn based ethanol has been cheaper and the choise for many buyers. Ideas are that petroleum prices can continue strong as OPEC and Russia have agreed to keep production constrained compared to world demand. Even so, there are ideas that world Sugar supplies are still enough to meet any demand.
Overnight News: Brazil will get chances for showers through mid weekend and then will turn drier. Temperatures should be near to above normal through the weekend and near to below normal for the first half of next week. ICE said that 14,618 contracts were posted for March delivery against Raw Sugar futures today.
Chart Trends: Trends in New York are mixed. Support is at 1320, 1280, and 1250 May, and resistance is at 1380, 1400, and 1440 May. Trends in London are mixed. Support is at 360.00, 355.00, and 353.00 May, and resistance is at 374.00, 376.00, and 380.00 May.
General Comments Futures closed sharply higher in both markets. Ideas of increasing demand and less production supported the market. Most in the trade anticipated the increased demand, and current West Africa weather is hot enough and dry enough to create production concerns. There have been reports recently of delayed deliveries to ports. Trends are up in both markets on the daily and weekly charts. It has been hot and dry in many parts of West Africa, but showers and more seasonal temperatures have been seen in the last week to improve overall production conditions. The gut slot for offers from the main crop is passing, and the sales by the government suggest that offers down the road can be less. The mid crop harvest is just a round the corner, and wire reports indicate that some initial mi crop harvest is underway in Nigeria. The recent grind data was weaker for North America, but positive for Europe and Asia. Demand is not universally strong, but has been improving and is likely to continue to improve as long as prices stay generally weak as processing margins are said to be very strong.
Overnight News: Scattered showers are expected in West Africa. Temperatures will average near to above normal. Malaysia and Indonesia should see frequent showers. Temperatures should average above normal. Brazil will get cry conditions and near to above normal temperatures. ICE certified stocks are lower today at 4.537 million bags.ICE ssid that 0 delivery notices were posted today and that total deliveries for the month are now 525 contracts.
Chart Trends: Trends in New York are up with no objectives. Support is at 2230, 2180, and 2170 May, with resistance at 2460, 2490, and 2520 May. Trends in London are up with no objectives. Support is at 1570, 1540, and 1520 May, with resistance at 1710, 1740, and 1770 May.
DJ CMAA Spot Cocoa Bean And Price Indications – Mar 5
Ex-dock or warehouse U.S. Eastern Seaboard North of Hatteras, in U.S. dollars
per metric ton. Settling price for March 2, 2018. All pricing is considered
nominal. Source: Cocoa Merchants Association of America.
N/A denotes not available.
Type Differential/ Price
Main Crop Ghana, Grade 1 355 2,691.00
Main Crop Ivory Coast, Grade 1 240 2,576.00
Main Crop Nigerian, Grade 1 180 2,516.00
Ecuador 200 2,536.00
Sanchez f.a.q. 170 2,506.00
PPP Natural African Type Carton Cocoa Butter 2.99 6,972.96
Cocoa Press Cake – Natural 10/12% Butterfat 0.56 1,300.00
Questions? Ask Jack Scoville today at 312-264-4322
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Past results are not necessarily indicative of future results. Investing in futures can involve substantial risk of loss & is not suitable for everyone. Trading foreign exchange also involves a high degree of risk. The leverage created by trading on margin can work against you as well as for you, and losses can exceed your entire investment. Before opening an account and trading, you should seek advice from your advisors as appropriate to ensure that you understand the risks and can withstand the losses.
The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures. The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author. Trading in futures contracts, options on futures contracts, and forward contracts is not suitable for all investors and involves substantial risks. ©2018
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