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 a little higher again yesterday. Weak overall demand continues to impact the US market, but word of smaller supplies is providing the support. The December 20 export sales report showed stronger demand than had been seen up until the shutdown. 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. India and Pakistan are expected to import more Cotton this year to cover the short domestic production. China had problems with its growing weather, too, and has been forced to import a lot of Cotton this year. Demand for US Cotton has been disappointing. 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 mostly dry weather and above normal temperatures, but more rain appears at the end of the week. The Southeast will get rain late this week. Temperatures should be below normal. Texas will have mostly dry weather. Temperatures will be on both sides of normal, with warm readings by the end of the week. The USDA average price is now 69.72 ct/lb. ICE said that certified stocks are now 120,309 bales, from 120,823 bales yesterday. USDA said that net Upland Cotton export sales for the week ending December 20 were 373,100 bales this year and 4,000 bales next year. Net Pima sales were 7,800 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 7280, 7220, and 7200 March, with resistance of 7460, 7650, and 7720 March.
General Comments: FCOJ was slightly lower again yesterday and is starting to push to new lows. Trends are down on the daily charts and remain down on the weekly charts. The Oranges harvest is active in Florida as the weather is warm and mostly dry. 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. Mostly good conditions are reported in Brazil, but the weather there is hot and dry again.
Overnight News: Florida should get dry weather today and tomorrow, then showers on Thursday and Friday. Temperatures will average below normal. Brazil should get mostly dry weather and above normal temperatures.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 116.00 March. Support is at 117.00, 114.00, and 111.00 March, with resistance at 123.00, 124.00, and 126.00 March.
General Comments: Futures were slightly lower yesterday in New York and in London. Brazil should be getting past the gut slot of its harvest, and the strong export pace from the country should start to turn down. Brazil had a big production year for the current crop, but the next crop should be less as it is the off-year for production. Ideas are that the current production is 62 or 63 million bags and about 52 million bags next year. Vietnam is active in its harvest. Production in Vietnam is estimated less than 30 million bags due to uneven weather during the growing season, but London has been lower, anyway, as it absorbs harvest and speculative selling.
Overnight News: Certified stocks are higher today and are about 2.481 million bags. The ICO composite price is now 101.06 ct/lb. Brazil will get mostly dry weather. Temperatures should be above 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 105.00, 107.00 and 110.00 March. Trends in London are mixed. Support is at 1500, 1480, and 1440 March, and resistance is at 1550, 1560, and 1610 March.
General Comments: Both markets were lower yesterday in consolidation trading. 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, but it appears that the country will not export nearly that much. Some industry sources told wire services that exports could be only half of the target. The government is now exploring ethanol use for the surplus. Dry conditions continue in northern Brazil and there are frequent rains in Rio Grande do Sul. Some precipitation is possible in the north late this weekend. 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 mostly dry weather. Temperatures should be above normal.
Chart Trends: Trends in New York are mixed to down with objectives of 1230 and 1160 March. Support is at 1250, 1230, and 1220 March, and resistance is at 1300, 1310, and 1330 March. Trends in London are mixed to down with objectives of 336.00 and 316.00 March. Support is at 341.00, 338.00, and 336.00 March, and resistance is at 348.00, 351.00, and 353.00 March.
DJ US Ethanol Production Down Again — Market Talk
11:03 ET – Production of ethanol in the US finished down by 19,000 barrels per day in the latest week, to 1.012M barrels, according to the EIA. This is the second week in a row that ethanol production has finished lower, and the 6th out of the last seven weeks where ethanol production has fallen. Compared to the same time last year, ethanol production is down 2.7%. Ethanol production consumes approximately 1/3rd of US corn being grown today, with ethanol prices following both sugar and oil prices. (email@example.com, @kirkmaltais)
General Comments: Futures closed lower yesterday on follow through selling. Trends are turning down in New York and down in London on the daily charts. 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 starting to wrap up in West Africa. The crop production estimates might become smaller due to Harmattan winds and hot and dry conditions that have moved into West Africa. The winds have stayed to the north of primary production areas so far this season. 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 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 higher today at 3.529 million bags.
Chart Trends: Trends in New York are mixed. Support is at 2230, 2220, and 2200 March, with resistance at 2310, 2370, and 2380 March. Trends in London are down with objectives of 1500 March. Support is at 1590, 1580, and 1560 March, with resistance at 1650, 1670, and 1680 March.