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 lower along with Chicago and on worries about an excalating trade war. Cotton would be a loser in a trade war with China as China once again looks ready to become a major world buyer. Chinese planting weather was poor with too much rain. Demand ideas remain strong, especially with the mills and their on call position waiting to be covered in the next couple of weeks. Lost Chinese production could mean increased sales for the US, especially now since the US will have the quality the Chinese need. China is moving to allow more imports by increasing quotas now. Ideas have been that US Cotton conditions remain poor due to the extreme dry and hot weather in western Texas. The current weather is less than ideal in West Texas as hot and dry conditions continue and is not good at other producing áreas around the world. The Southeast US is too wet, but has begun to dry out. The weather is bad in India and China, with big heat seen in India and Pakistan and too much rain in China. The monsoon has started in southern India, but Pakistan remains very hot and dry and is now facing drought conditions.
Overnight News: The Delta will be mostly dry and the Southeast will get drier weather this week. Both áreas have chances for showers late this weekend. Temperatures should be mostly below normal. Texas will see mostly dry conditions. Temperatures will be above normal. The USDA average price is now 90.39 ct/lb. ICE said that certified stocks are now 78,421 ba1es, from 78,384 bales yesterday.
Chart Trends: Trends in Cotton are mixed to up with objectives of 9940 July. Support is at 9270, 9170, and 8990 July, with resistance of 9680, 9740, and 9800 July.

Crop Progress
Date 3-Jun 20-May 2017 Avg
Cotton Planted 90 76 90 88
Cotton Squaring 15 9 14 10
Crop Condition
Very Poor Poor Fair Good Very Good
Cotton This Week 3 18 37 38 4
Cotton Last Week 1 15 42 38 4
Cotton Last Year 1 4 29 54 12

Wire: Bloomberg News (BN) Date: Jun 7 2018 13:15:00
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 June 12. Figures are in millions of bales.
*T
================================================================
|———Survey Results———|USDA
2018-19:| Avg | Low | High | May
================================================================
US Production | 19.41| 18.85| 19.75| 19.50
US Exports | 15.64| 15.00| 16.40| 15.50
US End Stocks | 4.80| 4.20| 5.20| 5.20
World Production | 120.10| 118.50| 121.19| 121.19
World Consumption | 124.48| 121.00| 126.00| 125.44
World End Stocks | 83.11| 80.00| 85.70| 83.75
*T
*T
================================================================================
Analyst |————-U.S.————–| World

| | | End | | | End
Estimates: | Production | Exports |Stocks | Production | Consumption |Stocks
================================================================================
Doane | 19.50| 16.40| 4.20| 120.00| 126.00| 80.00
Love | | | | | |
Consulting | 19.50| 15.50| 5.00| 121.00| 126.00| 83.40
Price Futures| | | | | |
Group | 19.50| 15.50| 5.20|n/a |n/a |n/a
Rabobank | 19.00| 16.00| 4.20| 119.50| 124.40| 81.20
Rose | | | | | |
Consulting | 18.85| 15.00| 4.75| 119.50| 124.50| 83.21
Texas A&M; | | | | | |
Robinson | 19.50| 15.50| 5.00| 121.19| 125.44| 83.75
Varner Bros. | 19.75| 15.50| 4.95| 118.50| 121.00| 85.70
Wedbush | | | | | |
Securities | 19.70| 15.70| 5.10| 121.00| 124.00| 84.50
*T
SOURCE: Bloomberg News
To contact the reporter on this story:
Dominic Carey in Washington at dcarey5@bloomberg.net
To contact the editors responsible for this story:
Alex Tanzi at atanzi@bloomberg.net
Simon Casey
—————————–====================——————————
Copyright (c) 2018, Bloomberg, L. P.
################################ END OF STORY 1 ##############################

FCOJ
General Comments: FCOJ was lower as Florida weather remains good and demand prospects do not. The hurricane season has started, but.there are no storms or áreas of interest yet in the Atlantic. Traders are worried about demand and are noting improved production prospects for Florida. The tariff wars between the US and Canada, Mexico, and the EU are hurting export demand ideas. The EU imports a lot of FCOJ and these exports could be hurt by any retaliation made by Europe. The EU has indicated that FCOJ will be on the list of ítems subject to increased tariffs and that the measures will be enacted next month. The growing conditions in Florida should continue to improve as the rainy season appears to be underway. The market is still dealing with a short crop against weak demand. Demand is bad enough that year on year inventories are increasing even with the very bad production last year. Florida producers are seeing golf ball sized or larger fruit. Conditions are reported as generally good. Brazil could use more rain as Sao Paulo has been hot and dry. The harvest there is about to start. Generally good, but somewhat variable conditions are reported in Europe and northern Africa.
Overnight News: Florida should get scattered showers each day. Temperatures will average near to above normal. Brazil should get mostly dry weather, but some showers tomorrow, and near to above normal temperatures.
Chart Trends: Trends in FCOJ are down with objectives of 154.00 and 153.00 July. Support is at 155.00, 152.00, and 150.00 July, with resistance at 159.00, 161.00, and 164.00 July.

COFFEE
General Comments Futures were slightly lower in New York, but a little higher in London. London rallied despite reports of lower prices in Vietnam. Demand for Robusta is good as Brazil said it was preparing to buy Robusta in the world market to cover domestic needs. The dry weather in Brazil production áreas for Robusta meant less production and tere is now not enough to cover the domestic demand. Meanwqhile, Robusta offers from Vietnam are less right now and traders say internal supplies are tight due to a smaller than expected harvest last year. A bigger new crop harvest is expeted as current rains are good. It remains mostly dry in Arabica áreas of Brazil, and there is no rain in the forecast for the next week. Origin is still offering in Central America and is still finding weak differentials. No coffee is moving in Nicaragua due to the political tensions there, and the volcano eruption in Guatemala has hurt the logistical situation there. Speculators anticipate big crops from Brazil and from Vietnam this year and have remained short in the market.
Overnight News: Certified stocks are higher today and are about 2.038 million bags. The ICO composite price is now 110.64 ct/lb. Brazil will get drier conditions, but a few showers today. Temperatures should be near to above normal today, then below normal by this weekend. Colombia should get isolated showers. Central America and southern Mexico should get showers. Vietnam will get showers.
Chart Trends: Trends in New York are down with objectives of 115.00 and 111.00 July. Support is at 115.00, 112.00, and 109.00 July, and resistance is at 119.00, 122.00 and 125.00 July. Trends in London are mixed to down with objectives of 1710 and 1680 July. Support is at 1700, 1670, and 1640 July, and resistance is at 1740, 1760, and 1780 July.

SUGAR
General Comments: Futures were higher on follow through buying tied to a recovery in the Brazilian Real and forecasts for dry weather in Brazil. Short term trends are starting to turn up again after the price action of yesterday. However, upside potential is considered limited and this is called mostly a short covering rally. Analysts noted that the market still has plenty of Sugar and no real fear of short supplies, so the currency moves just add to potential availability. Prices have been supported by the dry weather in Brazil and also the truckers strike there that is now over. Shipments to mills and ports have started again. It is dry in parts of Brazil, including some Sugarcane production áreas, and there is some talk of losses to the crop in the near future unless rains return soon. There are no real rains in the forecast for now. The harvest so far has been big and processing has been more active than last year. India is back to export Sugar this year after being a net importer for the last couple of years. The government is subsidizing industry and producers to help maintain an active market flow and to prevent the buildup of Sugar in storage. India will give aid of up to $1 billion to mills and will also stockpile supplies. Thailand has produced a record crop and is selling. 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, but light precipitation is posible today. Temperatures should be near normal.
Chart Trends: Trends in New York are mixed to up with objectives of 1320, 1380, and 1390 October. Support is at 1250, 11220, and 1190 October, and resistance is at 1280, 1320, and 1340 October. Trends in London are mixed. Support is at 347.00, 337.00, and 335.00 August, and resistance is at 356.00, 360.00, and 361.00 August.

DJ Brazil Center-South Sugar Crush Up 2.2% in Second Half of May
SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed more cane in the second half of May compared with a year earlier, according to industry group Unica.
Center-south mills crushed 32.4 million metric tons of cane in the period, a rise of 2.2% from the same period a year earlier. They produced 1.3 million tons of sugar, down 23.8%, and made 1.7 billion liters of ethanol, an increase of 44.5%.
The production mix for the second half of last month was 32.5% sugar to 67.5% ethanol. A year earlier, the mix was 47.5% sugar and 52.5% 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 June 1, mills in the region crushed 134.8 million tons of cane, up 20.2% from the same period a year earlier. Sugar production fell 3.9% to 5.5 million tons, and ethanol output rose 51.9% to 6.6 billion liters.
The production mix for the season through June 1 was 34.5% sugar to 65.5% ethanol. A year earlier, the mix was 45.2% sugar and 54.8% ethanol.

COCOA
General Comments Futures were lower, but traded well within the price range from last week. Futures have now fallen enough to fill a big gap on the weekly charts, and now the market is deciding on the next move. Nothing got decided yesterday, but there could be further losses due to trade tensions between the US and just about everyone else in the world. It is posible that Cocoa has now made a significant top in both markets and thaat more downside pressure is coming longer term. Cocoa is not directly involved, but anything that might hurt the world economy could dent Cocoa demand. Fears that developed about the EU economy last week spilled into Cocoa as Europe is the largest per capita consumer of chocolate in the world. North American demand could be pressured due to the economic wars started in the US against its neighbors. Showers and more seasonal temperatures have been seen in the last few weeks to improve overall production conditions in West Africa. Conditions also appear good in East Africa and Asia. The mid crop harvest is active in West Africa.
Overnight News: Scattered showers are expected in West Africa, but most main áreas will be dry. Temperatures will average near to above normal. Malaysia and Indonesia should see frequent showers. Temperatures should average above normal. Brazil will get dry conditions and near to above normal temperatures. ICE certified stocks are lower today at 5.087 million bags.
Chart Trends: Trends in New York are mixed. Support is at 2300, 2260, and 2250 July, with resistance at 2400, 2460, and 2480 July. Trends in London are mixed. Support is at 1650, 1600, and 1570 July, with resistance at 1710, 1750, and 1780 July.

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