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 yesterday, but could not penetrate resistance at the top of the trading range. The trading has had a firm tome over the last few weeks and could try to push through the resistance today or tomorrow. Hopes for Chinese demand and persistent cold and wet weather in growing areas are providing support. Everyone is waiting for the resolution of the US-China trade dispute, and the US government is indicating that a deal is going to be more difficult to achieve by the end of the month. Both sides are negotiating the final points, with the US worried about verification of the movers to fulfill commitments and the Chinese worried that they might give up too much to get a deal. It still looks like a deal will be done eventually, but it will take longer than had been indicated to get the last parts completed. The US weather continues to feature a lot of rain in the south, and fieldwork and initial planting in far southern areas is mostly delayed. Current long range forecasts suggest that wet conditions will continue in the Southeast and that Texas could see unsettled and colder than normal weather at least through the end of this month.
Overnight News: The Delta and Southeast should get rains today and tomorrow, then dry weather. Temperatures should average above normal through Thursday, then below normal. Texas will have some big rains today, then mostly dry weather. Temperatures will trend to above normal today and tomorrow, then trend to below normal. The USDA average price is now 69.31 ct/lb. ICE said that certified stocks are now 112,289 ba1es, from 112,228 bales yesterday. ICE said that 6 notices were posted for delivery against March contracts and that total deliveries for the month are now 120 contracts.
Chart Trends: Trends in Cotton are mixed. Support is at 7380, 7250, and 7190 May, with resistance of 7510, 7540, and 7610 May.
General Comments: FCOJ was higher in recovery trading. The charts show that the market has finally bottomed. The market has absorbed speculative long liquidation and producer selling through the Winter as no freeze has developed. The Oranges harvest remains active in Florida as the weather is mostly dry. The fruit is abundant. 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. Flowering for the next crop is ongoing, and fruit is starting to form on some trees. Mostly good conditions are reported in Brazil, and some beneficial rains should be seen this week. USDA left Florida production estimates unchanged at 77 million boxes last week.
Overnight News: Florida should get mostly dry weather. Temperatures will average above normal. Brazil should get scattered showers and above normal temperatures. ICE said that 0 delivery notices were posted against March contracts and that total deliveries for the month are now 312 contracts.
Chart Trends: Trends in FCOJ are up with objectives of 124.00 and 131.00 May. Support is at 122.00, 117.00, and 116.00 May, with resistance at 126.00, 128.00, and 130.00 May.
General Comments: Futures were lower in New York on fund selling tied to weakness in the Brazilian Real. Prices closed slightly lower in London. New York trends are down, but chart trends are sideways in London. Speculators are keeping the pressure on the New York market as they fear big supplies of Arabica with not enough demand. Big exports as reported by the ICO for January and from Brazil all season long imply that the market is well supplied. Brazil export data has shown a strong pace at over 3 million bags for the second month in a row. The ICO has forecast a surplus year again this year, and inventory data from ICO and others shows ample supplies. Prices are moving below profitable levels for Colombia, and have been below profitable levels for producers in Central America. Further weakness will cause farmers in Brazil, Peru, and Vietnam to start losing money as well. Showers are in the forecast for this week. Vietnam is active in its harvest, but producers are not willing to sell at current prices. It is still dry, and production potential for the next crop is being hurt.
Overnight News: Certified stocks are near unchanged today and are about 2.491 million bags. The ICO composite price is now 98.01 ct/lb. Brazil will get scattered showers. Temperatures should be above normal. Colombia should get isolated showers. Central America and southern Mexico should get showers. Vietnam will get mostly dry weather. ICE said that 39 delivery notices were posted against March contracts and that total deliveries for the month now total 218 contracts.
Chart Trends: Trends in New York are down with objectives of 93.00 and 89.00 May. Support is at 94.00, 91.00, and 85.00 May, and resistance is at 98.00, 100.00 and 101.00 May. Trends in London are mixed to down with objectives of 1500 and 1470 May. Support is at 1500, 1480, and 1450 May, and resistance is at 1540, 1550, and 1560 May.
DJ Brazil Exported 3.4 Million Bags of Coffee in February, Cecafe Says
By Jeffrey T. Lewis
Brazilian coffee exports rose in February from a year earlier as sales abroad of both the arabica and robusta varieties jumped, according to exporters group Cecafe.
The South American country exported 3.4 million 132-pound bags of coffee last month, an increase of 36.3% from the same month a year earlier, Cecafe said Wednesday.
Sales abroad of the arabica variety of coffee rose 40.5%, to 3.1 million bags, while exports of robusta beans increased to 189,848 bags, from 27,829 bags in February 2018.
Exports of roasted, ground and instant coffee rose 2.3% in February, to 282,227 bags, Cecafe said.
General Comments: New York closed a little higher, but London closed a little lower. Charts for both markets are showing the potential for a short term rally attempt. Chart patterns on the weekly charts are still down. The fundamentals still suggest big supplies, and the weather in Brazil has improved to support big production ideas. UNICA reported that the center south produced 2,000 tons of Sugar in the first half of February, compared to 5,000 tons in the previous two week period. The mills crushed just 280,000 tons of Sugarcane, compared to 563,000 tons the previous period. Brazil weather is improving in all areas as there is less rain in southern areas and more to the north. Brazil has been using a larger part of its Sugarcane harvest to produce ethanol this year instead of Sugar, but Thailand has shown increased production this year. Ideas that production in India and Pakistan is being hurt by news that Indian mills are asking the government not to force them to sell Sugar into a depressed world market. They do not want to lose more money as they have already needed government subsidies to keep working. Very good conditions are reported in Thailand.
Overnight News: Brazil will get showers. Temperatures should be above normal.
Chart Trends: Trends in New York are mixed to down with objectives of 1200 and 1170 May. Support is at 1220, 1210, and 1200 May, and resistance is at 1250, 1280, and 1300 May. Trends in London are mixed to down with no objectives of 342.00 May. Support is at 336.00, 335.00, and 333.00 May, and resistance is at 344.00, 347.00, and 352.00 May.
General Comments: Futures closed higher after absorbing early selling on ideas that current warmer and drier conditions in West Africa could produce a shorter mid crop. The main crop harvest is almost over in West Africa, and Ivory Coast arrivals are strong. Growing conditions are generally good in West Africa. Rains are in the forecast for the next couple of days that will improve soil moisture conditions, and the cold and dry Harmattan winds of early this week will be a thing of the past. Nigeria is reporting losses to its crops due to recent hot and dry weather. Cameroon is also reporting less production and prices there are reported strong. Conditions appear good in East Africa and Asia.
Overnight News: Mostly dry conditions are expected in West Africa. Temperatures will average near to 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 4.244 million bags. ICE said that there were 0 notices posted for delivery against March contracts and that total deliveries for the month are now 1,086 contracts.
Chart Trends: Trends in New York are mixed. Support is at 2170, 2150, and 2120 May, with resistance at 2230, 2240, and 2250 May. Trends in London are mixed. Support is at 1650, 1620, and 1600 Mary, with resistance at 1720, 1730, and 1750 May.