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

COTTON
General Comments: Cotton was higher. There are ideas that the US is now running short of high quality Cotton to deliver to the exchange and to overseas buyers. Demand remains strong in export markets as the weekly export sales report showed moderate to strong volumes last week. Chart trends are mixed on daily charts and up on weekly charts. New crop planting is now about the same as the five-year average. The weather in the western Great Plains is showing some improvement as some areas have finally seen some precipitation. However, the precipitation was minimal and not of much benefit to farmers. Forecasts call for mostly dry weather for the next couple of weeks, and producers in the western Great Plains are likely to wait for better rains before planting more Cotton. In contrast, farmers in the Delta and Southeast have seen too much rain and have had delays as soils dry out. The overall planting pace is likely to remain slow.
Overnight News: The Delta and the Southeast will get drier weather through the weekend. Temperatures should be mostly below normal. Texas will see mostly dry conditions until showers return on Sunday. Temperatures will be above normal. The USDA average price is now 81.61 ct/lb. ICE said that certified stocks are now 74,260 ba1es, from 72,999 bales yesterday. ICE said that there were 0 contracts tendered for delivery today and that total deliveries are now 199 contracts. USDA said that net Upland Cotton export sales were 193,100 bales this year and 228,600 bales next year. Net Pima sales were 3,300 bales this year and 300 bales next year.
Chart Trends: Trends in Cotton are mixed to up with objectives of 9220 and 9940 July. Support is at 8510, 8470, and 8450 July, with resistance of 8700, 8750, and 8780 July.

Wire: Bloomberg News (BN) Date: May 7 2018 16:20:00
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 eight analysts for the USDA’s World Agricultural Supply and Demand
report on the 2018-19 cotton crop, which is scheduled for release at noon in
Washington on May 10. Figures are in millions of bales.
================================================================
|——–Survey Results———|USDA
2018-19:| Avg | Low | High | 2017-18
================================================================
US Production | 20.31| 18.50| 21.50| 21.03
US Exports | 15.66| 15.00| 16.60| 15.00
US End Stocks | 4.96| 3.60| 6.10| 5.30
World Production | 120.15| 115.00| 122.00| 122.18
World Consumption | 121.82| 120.00| 123.50| 120.39
World End Stocks | 85.22| 79.50| 88.50| 88.29
================================================================================
Analyst |————U.S.————| World
| | | End
Estimates: |Production |Exports |Stocks |Production |Consumption |Stocks
================================================================================
Cottonexperts.com | 20.85| 16.60| 3.60| 121.90| 120.90| 87.00
Doane | 19.80| 15.90| 4.90| 120.00| 123.50| 84.00
Love Consulting | 20.50| 16.00| 6.10| 120.00| 123.00| 84.00
Price Futures Group| 21.50| 15.00| 6.00|n/a |n/a |n/a
Rose Consulting | 18.50| 15.00| 4.35| 115.00| 123.00| 79.50
Texas A&M; Robinson| 19.50| 16.00| 5.10|n/a |n/a |n/a
Varner Bros. | 20.85| 15.75| 4.45| 122.00| 120.00| 88.50
Wedbush Securities | 21.00| 15.00| 5.20| 122.00| 120.50| 88.30
SOURCE: Bloomberg News
To contact the reporter on this story:
Dominic Carey in Washington at dcarey5@bloomberg.net

FCOJ
General Comments: FCOJ was higher on reduced production prospects in Brazil along with the reduced US production. It looks like FCOJ is in a weather market as dry conditions are reported in Florida and in production areas of Brazil. The weather has been dry and the harvest is starting to wind down in some areas of Florida. Some showers are possible late this week. The market is still dealing with a short crop against weak demand. The harvest is progressing well and fruit is being delivered to processors. Producers are now into the Valencia crop. Florida producers are seeing marble sized fruit. Conditions are reported as generally good, although most producers would like more rain. Irrigation is being used. Brazil also could use more rain as Sao Paulo has been hot and dry. Generally good conditions are reported in Europe and northern Africa.
Overnight News: Florida should get mostly dry weather this week and showers and storms his weekend. Temperatures will average near to below normal. Brazil should get mostly dry weather and near to above normal temperatures. The best precipitation should be this weekend. There have been no deliveries so far in New York against May contracts.
Chart Trends: Trends in FCOJ are up with objectives of 171.00 and 177.00 July. Support is at 165.00, 162.00, and 157.00 July, with resistance at 170.00, 173.00, and 176.00 July.

DJ Orange Juice Rises on Tight Brazilian Forecast — Market Talk
1521 ET – Dry, hot weather in October in Brazil is weighing on this year’s orange crop. Brazil’s Fundecitrus releases its forecast for the 2018/2019 season at 288 million boxes, a 28% drop, a record decline for any given year given last year’s robust crop. The firm estimates that 17% will drop from trees before it is ripe given the dry weather and increased prevalence of an incurable disease called citrus greening. That disease has already decimated Florida’s orange crop which is at its lowest level since the 1940s.

COFFEE
General Comments Futures in New York and London were lower again yesterday in response to higher than expected April exports from Brazil. News that the Brazilian harvest could start in the next few weeks brought ideas of bigger supplies and less need to chase higher prices for now. Funds and other speculators were net sellers and industry was a net buyer in New York. The weekly charts still show that a reversal might have happened. London daily charts show the potential for a new uptrend to be underway. Origin is still offering in Central America and is still finding weak differentials. The demand has been active, but not willing to chase prices higher. New York traders are talking about good weather currently being reported in Brazil and expect another bumper crop. Robusta remains the stronger market as Vietnamese producers and merchants are not willing to sell at current prices and are willing to wait for a rally. Supplies of Coffee in Europe have been dropping. Wire reports suggest that conditions for the crop are good as the rainy season gets underway. Vietnamese cash prices were steady again last week.
Overnight News: Certified stocks are higher today and are about 1.994 million bags. The ICO composite price is now 112.36 ct/lb. Brazil will get drier conditions until showers appear on Sunday. Temperatures should be near to above normal. Colombia should get isolated showers. Central America and southern Mexico should get isolated showers or dry conditions. Vietnam will get showers in the north starting tomorrow. ICE said that there were 8 deliveries today in New York and that total deliveries for the month are 240 contracts.
Chart Trends: Trends in New York are mixed to down with objectives of 115.00 and 111.00 July. Support is at 117.00, 115.00, and 112.00 July, and resistance is at 121.00, 124.00 and 126.00 July. Trends in London are mixed. Support is at 1740, 1720, and 1700 July, and resistance is at 1780, 1810, and 1840 July.

DJ Brazil Exported 2.2 Million Bags of Coffee in April — Cecafe
SAO PAULO–Brazilian coffee exports were unchanged in April from a year earlier as an increase in exports of the robusta variety offset a decline for ground, roasted and instant coffee, according to exporters group Cecafe.
The South American country exported 2.2 million 132-pound bags of coffee last month, the same amount as in the April 2017, Cecafe said Wednesday.
Exports of the arabica variety of coffee fell 0.5% to 1.9 million bags, while exports of robusta beans doubled to 53,472 bags.
Exports of roasted, ground and instant coffee fell 7.1% in April to 258,054 bags, Cecafe said.

SUGAR
General Comments: Futures were lower in range trading. Longer term, the price action still suggests that new lows for the move and new contract lows are coming. The fundamentals still suggest that lower prices are still coming as analysts remain focused on big world production.. There is still big supplies available to the market. Plenty of Sugar will most likely be around, and many analysts support that idea by calling for big production surpluses for this and next year. Reports in the first part of last week that the Brazil season was off to a big start caused the last round of selling interest, and ideas that the market was oversold has caused the recent recovery. India is back to export Sugar this year after being a net importer for the last couple of years. Thailand has produced a record crop and is selling. Brazil still has plenty of Sugar to sell, and even the EU has had over production in the past year. Middle East and North African buyers are reported to be buying normal or less than normal amounts of Sugar in the world market right now.
Overnight News: Brazil will get dry weather. Temperatures should be near to above normal.
Chart Trends: Trends in New York are mixed. Support is at 1130, 1100, and 1080 July, and resistance is at 1160, 1190, and 1200 July. Trends in London are mixed. Support is at 318.00, 316.00, and 311.00 August, and resistance is at 332.00, 336.00, and 340.00 August.

DJ Brazil Center-South Sugar Crush Up 55.3%, Production Up 34.8%
SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed more cane in the second half of April compared with a year earlier, according to industry group Unica.
Center-south mills crushed 37.7 million metric tons of cane in the period, an increase of 55.3% from the same period a year earlier. They produced 1.5 million tons of sugar, up 34.8%, and made 1.7 billion liters of ethanol, up 84.7%.
The production mix for the second half of last month was 35.8% sugar to 64.2% ethanol. A year earlier, the mix was 43.1% sugar and 56.9% ethanol.
Brazil is the world’s biggest sugar producer and exporter, and the center-south grows about 90% of the country’s cane.
In the season from April 1 through May 1, mills in the region crushed 59.8 million tons of cane, up 42.7% from the same period a year earlier. Sugar production rose 21.6% to 2.2 million tons, and ethanol output rose 67.7% to 2.7 billion liters.
The production mix for the season through May 1 was 34.3% sugar to 65.7% ethanol. A year earlier, the mix was 41.6% sugar and 58.4% ethanol.

DJ India Production, Exports Will Add to Global Sugar Surplus — Market Talk
0309 GMT – Global sugar prices could come under more pressure as India’s production in the year to Sep. 30 2019 is set to rise and domestic subsidies are likely to encourage an uptick in its exports. The US Department of Agriculture says India’s production is expected to increase 4.2% to 33.8 million tons in 2018/19 and notes that exports in the same period are expected to reach 6 million metric tons, up from exports of 2 million tons in the current year. ICE front month sugar is trading at 11.56 cents per pound.(lucy.craymer@wsj.com)

COCOA
General Comments Futures were sharply lower in early trading, but recovered to close with only moderate losses. Trends in New York are sideways for now, but it still looks like the market could be making a top. London could start to form a top now as well. Ideas that world production has been largely sold remain part of the rally. Showers and more seasonal temperatures have been seen in the last few weeks to improve overall production conditions in West Africa. The mid crop harvest is starting, and wire reports indicate that some initial mid crop harvest is underway in all countries. Yield estimates imply that variable yields can be expected. The harvest should begin soon in Ivory Coast and Ghana. Certified stocks are increasing in the US as US futures have been so much stronger than London futures.
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 5.317 million bags. ICE said that 8 delivery notices were posted against May Contracts and that total deliveries for the month are now 185 contracts.
Chart Trends: Trends in New York are mixed. Support is at 2730, 2700, and 2690 July, with resistance at 2800, 2860, and 2900 July. Trends in London are mixed. Support is at 1890, 1850, and 1810 July, with resistance at 1970, 2000, and 2030 July.

DJ No Break Between Mid, Main Cocoa Harvest in Southwest Nigeria -Traders
By Obafemi Oredein
IBADAN, Nigeria–There will be no break between the harvest of the midcrop and the 2018-19 season’s main crop cocoa in southwestern Nigeria, officials and farmers said Wednesday.
“The current midcrop harvest will run into the harvest of the main crop this year,” said Adio Akinyele, a farmer in Ibadan, capital of southwest Oyo state. “The usual break will not occur due to good rainfall that is boosting the development of next season’s main cocoa.”
Harvesting of the midcrop began in the southwest cocoa region in March. It normally ends in July or August, while the harvest of the main crop usually starts in September or October and ends in January or February, Mr. Akinyele said.
“New leaves, flowers and cherelles–tiny cocoa pods–are now on cocoa trees in preparation for the 2018-19 main crop cocoa,” said Mr. Akinyele.
Sayina Riman, president of the Cocoa Association of Nigeria said the country’s main crop will start at least one month ahead of schedule due to the current boon of wet weather in the country’s south, where all the country’s cocoa is cultivated.
He added that the main crop harvest usually starts in September but “if the rain keeps up, we will see early main crop harvest in July or August.”

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