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 higher, with July leading the way. New crop months were a little higher and are keeping a close eye on the weather and demand potential. Wire reports indicate that tariffs against US Cotton have forced buyers in China to look to India. Forward sales have increased and prices there have held firm. The US would have been the primary source, now India and other countries are doing the selling. Crop conditions are improved as some rains have been seen in Texas and as the Southeast has been a little drier. USDA showed improved conditions on Monday. The weather is improving in India and China, with big heat seen in India and Pakistan and too much rain in China. China has turned drier in the past week. The monsoon has started in southern and central India, but Pakistan remains very hot and dry and is still facing drought conditions. The drought in Pakistan is turning serious as some irrigation supplies are starting to run out and as some Wells start to run dry. USDA will issue its quarterly stocks and planted area reports on Friday, and planted area should be a little higher.
Overnight News: The Delta and the Southeast will get mostly dry weather. Temperatures should be above normal. Texas will see mostly dry conditions. Temperatures will be above too much above normal. The USDA average price is now 82.19 ct/lb. ICE said that certified stocks are now 91,960 bales, from 92,009 bales yesterday. ICE said that 52 delivery notices were posted against July Contracts today and that total deliveries are now 649 contracts. USDA said that net Upland Cotton export sales were -18,900 bales this year and 196,700 bales next year. Net Pima sales were 2,300 bales this year and 56,400 bales next year.
Chart Trends: Trends in Cotton are mixed to down with objectives of 7880 December. Support is at 8420, 8380, and 8300 December, with resistance of 8560, 8620, and 8710 December.
General Comments: FCOJ was a little higher and the market remains in a big trading range as it waits for news. Florida weather remains good and demand prospects remain poor. There are no tropical systems on the horizon to hurt production potential. 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 will most likely be hurt due to retaliation that will be made by Europe that included increased tariffs on US FCOJ. The EU has indicated that FCOJ will be on the list of items subject to increased tariffs and that the measures will be enacted next month. The growing conditions in Florida should remain good as the rainy season appears to be underway. Florida producers are seeing golf ball sized or larger fruit, and work in groves maintenance is active. Irrigation is being used. Brazil could use more rain as Sao Paulo has been hot and mostly dry. The harvest there is active.
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 mixed. Support is at 158.00, 156.00, and 153.00 September, with resistance at 165.00, 167.00, and 169.00 September.
General Comments Futures were a little lower in New York as the Dollar rallied, and higher in London as the market starts to look for offers from Vietnam. The charts showed a potential short-term bottom in New York, and speculators were on both sides of the market. London was firm despite ideas of good world availability of Robusta. It has been dry in Vietnam, and there is little on offer from that origin as producers want to see how big the next crop will be and try to wait for higher prices. New York is in a short-term trading range, while trends in London turned mixed. Robusta offers from Vietnam are still down and traders say internal supplies are tight due to a smaller than expected harvest last year. It remains mostly dry in Arabica areas 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. 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 2.060 million bags. The ICO composite price is now 110.33 ct/lb. Brazil will get drier conditions. Temperatures should be near to above normal. Colombia should get isolated showers. Central America and southern Mexico should get showers. Vietnam will get showers. ICE said that 24 delivery notices were posted in New York and that total deliveries for the month are now 1,173 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 120.00 and 123.00 September. Support is at 116.00, 115.00, and 112.00 September, and resistance is at 119.00, 120.00 and 122.00 September. Trends in London are mixed. Support is at 1680, 1670, and 1640 September, and resistance is at 1710, 1730, and 1750 September.
General Comments: Futures were lower in both New York and London in response to the stronger US Dollar and ideas of big supplies. The UNICA data failed to support the market for a second day as world supplies in general are still considered very big. UNICA showed another big reporting period for demand and processing, and noted that the mills are processing Sugarcane more and more for Ethanol. There is no real selling interest from producers as they hope for higher prices. Brazil producers are also worried about Cane production even with the rapid early harvest. Movement from mills to ports has been slow due to the high freight costs left from the recent truckers strike. However, there is still a lot of Sugar in the world. India is back to export Sugar this year after being a net importer for the last couple of years. India has reached a deal to buy at least part of the Indian surplus, so hopes are that India will not offer as much into the world market. However, a potential source of big demand might also be lost. Conditions have improved in the last week as monsoon rains have arrived. Thailand has produced a record crop and is selling.
Overnight News: Brazil will get dry weather. Temperatures should be near to above normal.
Chart Trends: Trends in New York are mixed to down with no objectives. Support is at 1200, 1190, and 1170 October, and resistance is at 1230, 1250, and 1260 October. Trends in London are mixed to down with no objectives. Support is at 336.00, 335.00, and 331.00 October, and resistance is at 341.00, 346.00, and 348.00 October.
General Comments Futures were lower in New York and London on ideas that current weather conditions are good for crops in West Africa. There have been reports of good rains throughout the region and big yields are possible. There are still some concerns about demand as consumers are looking for healthier products to consume in many cases and as the world economy is still an issue. Ideas are that demand can start to improve with the lower price levels, but the world economic situation is still in a flux and the Pound and the Euro were weaker yesterday. Fears about the EU economy last week are important to 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 areas 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 4.898 million bags. ICE said that 17 notices were posted against July contracts and that total deliveries for the month are now 22 contracts.
Chart Trends: Trends in New York are mixed. Support is at 2320, 2260, and 2220 September, with resistance at 2430, 2490, and 2530 September. Trends in London are mixed to down with objectives of 1730 and 1670 September. Support is at 1710, 1680, and 1600 September, with resistance at 1790, 1820, and 1850 September.