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 lower once again last week as weak overall demand continues to impact the US market. The market was little changed on Monday. Traders were also looking at the moves seen in the stock indices and petroleum complex and were deciding not to trade in other markets. There was talk of a recession coming that could hurt demand eventually for Cotton. World production and supplies are going still lower due to bad weather in the growing season for major producers around the world, including India, Pakistan, and Australia. China had problems with its growing weather, too. Demand for US Cotton has been disappointing, as the weekly export sales reports have shown average demand at best since the start of the marketing year. China has not bought any US Cotton this year and has been active in other markets, especially India. US prices are down and China might start to look at the US crop, but there have been worries about the quality of the US crop due to some extreme growing conditions in Texas and the Southeast over the Summer and Fall. Ideas are that the quality worries have kept some importers of US Cotton away from the market.
Overnight News: The Delta should get showers and storms the rest of the week and mostly above normal temperatures. The Southeast will get rain or showers. Temperatures should be above normal. Texas will have mostly dry weather. Temperatures will be below normal. The USDA average price is now 67.63 ct/lb. ICE said that certified stocks are now 136,347 bales, from 136,257 bales yesterday.
Chart Trends: Trends in Cotton are down with objectives of 7000 and 6500 March. Support is at 7180, 7120, and 7060 March, with resistance of 7420, 7650, and 7720 March.
General Comments: FCOJ was higher on Friday, but lower for the week. Futures were lower on Monday. The Oranges harvest is active in Florida, but will likely get delayed over the next couple of days. The fruit is abundant, but arrivals to packing houses and processors are reported behind last year. Florida producers are seeing small-sized to good-sized fruit, and work in groves maintenance is active. Irrigation is being used in all areas. Packing houses are open to process fruit for the fresh market, and all processors are open in the state to take packing house eliminations and fresh fruit.
Overnight News: Florida should get mostly dry conditions. Temperatures will average near to above normal. Brazil should get chances for scattered showers this week and above normal temperatures. The weekend should be dry.
Chart Trends: Trends in FCOJ are down with objectives of 122.00 January. Support is at 123.00, 120.00, and 117.00 January, with resistance at 128.00, 132.00, and 134.00 January.
General Comments: Futures were a little higher in both markets last week in consolidation trading. New York was a little higher on Monday, while London closed a bit lower. Speculators were on both sides of the market and cash markets were quiet. Currency relationships, and especially the rate between the US Dollar and the Brazilian Real, continue to be the driving force in Coffee trading. The Brazil crops are getting harvested now, and production estimates now range as high as 63.7 million bags. It is a big crop and the main reason to see prices in New York as low as they are right now. Producers are also looking ahead to next year, and production could drop sharply in the off production year. El Nino remains in the forecast and Coffee areas in Brazil could be affected by drought that could hurt production even more. Vietnam is active in its harvest and middlemen were said to be active buyers of the harvest at levels just above the industry. Production in Vietnam is estimated less than 30 million bags due to uneven weather during the growing season. The harvest in both countries will wind down over the next month.
Overnight News: Certified stocks are higher today and are about 2.461 million bags. The ICO composite price is now 99.86 ct/lb. Brazil will get chances for scattered showers each day. Temperatures should be near to below normal. Colombia should get isolated showers. Central America and southern Mexico should get showers or dry conditions. Vietnam will get mostly dry weather.
Chart Trends: Trends in New York are mixed. Support is at 100.00, 99.00, and 96.00 March, and resistance is at 104.00, 105.00 and 107.00 March. Trends in London are mixed. Support is at 1500, 1480, and 1470 March, and resistance is at 1540, 1560, and 1610 March.
General Comments: New York closed a little higher last week, but was lower on Monday as funds turned sellers again. March futures are now near some support at about 1200. London was higher as well. The weekly charts in both markets suggest that futures are carving out some long-term lows. Sugar was hurt by the weakness in petroleum futures that have hurt demand ideas. Petroleum futures appear to be making some short-term lows at this time, so that might help change the tone in Sugar. Brazil has been using a majority of its Sugarcane harvest to produce ethanol this year instead of Sugar, and there is some talk the mills might switch back to Sugar unless petroleum prices improve soon. There are doubts on just how much production will be seen this year in India. Northwest India had been experiencing hot and dry weather that could cut yields. It has not announced a reduction in its export goal of 5.0 million tons this year. Dry conditions continue in Brazil, the EU, and Russia, but conditions are mostly good in Ukraine. Very good conditions are reported in Thailand, but the next production could be less as farmers might switch to other crops due to low prices for Sugarcane.
Overnight News: Brazil will get chances for scattered showers each day. Temperatures should be near to below normal.
Chart Trends: Trends in New York are mixed. Support is at 1220, 1210, and 1190 March, and resistance is at 1250, 1270, and 1290 March. Trends in London are mixed. Support is at 334.00, 330.00, and 324.00 March, and resistance is at 342.00, 345.00, and 348.00 March.
General Comments: Futures closed higher for the week in New York and higher in London as the new main crop harvest comes to market in West Africa. Both markets were a little higher on Monday. Trends are now up in both markets, and the weekly charts show that a significant up side move is possible. The outlook for strong production in the coming year is still around, and ports are said to have plenty of Cocoa on offer. The main crop harvest is active in West Africa. Main crop production ideas for Ivory Coast and Ghana are being reduced, with Ivory Coast now estimating its main crop production at 1.985 million tons, down from previous estimates just over 2.0 million tons. The crop production estimates might become smaller due to Harmattan winds and hot and dry conditions that have moved into West Africa. These conditions can take moisture out of the soil very rapidly and cause some very significant stress on the trees. Conditions appear good in East Africa and Asia. Demand is said to be improving as offers from the new harvest start to increase.
Overnight News: Mostly dry conditions are expected in West Africa. Temperatures will average mostly above normal. Malaysia and Indonesia should see showers. Temperatures should average above normal. Brazil will get mostly dry conditions and near to above normal temperatures. ICE certified stocks are sharply higher today at 3.467 million bags.
Chart Trends: Trends in New York are up with no objectives. Support is at 2340, 2320, and 2290 March, with resistance at 2410, 2430, and 2480 March. Trends in London are up with objectives of 1720 and 1750 March. Support is at 1710, 1700, and 1660 March, with resistance at 1760, 1800, and 1840 March.