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 higher as the weather is an important factor again. The weekly export sales report was not strong. There are some concerns that the cold May weather from Texas to the Delta might cause lower yields this Fall. It has been hot and dry for the last few weeks in the Southeast, and crops of all kinds in the region need water and cooler weather. Precipitation moved into the region over the weekend and brought some very big rains. Also pressuring the market are forecasts for big production around the world. USDA sees no shortage of Cotton anywhere in the coming year. However, it could be that the Indian monsoon gets off to a slow start and production potential gets hurt there and in Pakistan. It has been dry so far and is turning hotter, but this is considered pre monsoonal weather. Below normal rains are now in the forecast for both countries in June.
Overnight News: The Delta and Southeast should get drier weather until showers and storms start to develop again this weekend. Temperatures should be mostly above normal. Texas will have mostly dry weather this weekend and showers again next week. Temperatures will average near to above normal. The USDA average price is now 61.76 ct/lb. ICE said that certified stocks are now 89,643 bales, from 88,340 bales yesterday.
Chart Trends: Trends in Cotton are mixed to down with objectives of 6540 and 6240 July. Support is at 6630, 6550, and 6520 July, with resistance of 6750, 6850, and 6950 July.

DJ On-Call Cotton – Jun 13
As of Jun 7. On-call positions represent spot cotton sold to or
purchased from a merchant, based on New York cotton futures contracts
of 500-pound bales. Prices are not yet fixed against these contracts.
Source: CFTC
*-denotes changes from the previous week are based on revised data from
last week.
Call Previous Change Call Previous Change
Sales Purchases
Jul 19 9,084 11,499 -2,415 5,292 5,535 -243
Oct 19 0 0 0 0 0 0
Dec 19 29,530 29,764 -234 38,819 38,916 -97
Mar 20 20,426 20,413 13 3,447 3,192 255
May 20 7,905 8,012 -107 431 387 44
Jul 20 12,898 12,486 412 2,093 2,102 -9
Dec 20 6,386 6,280 106 11,834 10,980 854
Mar 21 2,383 2,185 198 574 309 265
May 21 641 641 0 0 0 0
Jul 21 394 394 0 0 0 0
Dec 21 133 331 -198 22 22 0
Total 89,780 92,005 -2,225 62,512 61,443 1,069
Open Change
Int
Jul 19 74,118 93,449 -19,331
Oct 19 63 49 14
Dec 19 103,776 93,661 10,115
Mar 20 17,830 15,856 1,974
May 20 2,142 2,005 137
Jul 20 3,545 3,502 43
Dec 20 8,477 7,940 537
Mar 21 205 111 94
May 21 0 0 0
Jul 21 0 0 0
Dec 21 0 0 0
Total 210,156 216,573 -6,417

FCOJ
General Comments: FCOJ was a little higher in range trading. The weather is a little dry in Florida, but speculators are preparing for the hurricane season and have been buying futures. The season started on June 1. USDA production estimates are above 70 million boxes and USDA still expects a strong crop of oranges. Inventories in Florida are still 17% above a year ago. That means that there should be no shortage of oranges available to the market to make FCOJ. The increase is coming from less demand along with the increased domestic production. Fruit for the next crop is developing and are as big as golf balls. Crop conditions are called good. Irrigation is being used a few times a week to help protect crop condition. Mostly good conditions are reported in Brazil as the harvest there is active.
Overnight News: Florida should get scattered showers and storms through the weekend. Temperatures will average near to above normal. Brazil should get scattered showers late this week and below normal temperatures.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 88.00, 85.00, and 81.00 July. Support is at 100.00, 97.00, and 95.00 July, with resistance at 106.00, 108.00, and 113.00 July.

COFFEE
General Comments: Futures were lower yesterday as the Real was lower. Most traders are rolling forward out of July positions as July futures will go into delivery next week. The Brazil harvest is moving along at a slow pace. Reports indicate that the yields are not real strong and that the quality of the crop is poor due to extreme weather seen early in the growing season. Vietnam is also reporting lower yields for the current crop as the weather was not good for flowering earlier in the year. There have been some hot and dry spells that have hurt yield and quality for these crops as well. Even so, the market in London has been under selling pressure due in part to increased offers from Brazil. Buyers are now more actively pursuing other origins, especially for certified or higher end coffees. The charts show that both markets could trade in a sideways pattern for now as the market looks at weather and production potential of the next crop.
Overnight News: ICE certified stocks are slightly higher today at 2.383 million bags. The ICO daily average price is now 97.75 ct/lb. Brazil will get mostly dry conditions with near to above normal temperatures. Vietnam will see scattered showers and storms.
Chart Trends: Trends in New York are mixed to down with objectives of 88.00, 85.00, and 81.00 July. Support is at 97.00, 95.00, and 90.00 July, and resistance is at 100.00, 103.00 and 106.00 July. Trends in London are mixed to down with objectives of 1380 and 1340 July. Support is at 1380, 1360, and 1330 July, and resistance is at 1420, 1440, and 1460 July.

SUGAR
General Comments: Futures closed higher, and New York started to build on gains seen in recent sessions. London is showing more of a trading range for the week. Part of the strength came from fears of production losses in India due to the delayed monsoon. Processing of Sugarcane in Brazil has been off to a slow start and there are some ideas that Sugarcane production was not all that strong this year due to uneven weather. Processing is increasing now as the harvest finally starts to really get going. There are concerns that the Indian monsoon will not be strong this year and that Sugarcane production could be hurt. It is hot and dry there so far, but monsoon rains are on the increase in the east and a major tropical storm could deluge areas in the west of India and into Pakistan. Even so, there are now a lot of private forecasts that June rains in both India and Pakistan will be below average. The government weather services there is looking for a normal monsoon, but many private forecasters expect less rain and warmer temperatures than normal. Very good conditions are reported in Thailand. Demand for Sugar has been average, and demand for ethanol is reported to be increasing.
Overnight News: Brazil will get mostly dry weather or light showers. Temperatures should be near to above normal.
Chart Trends: Trends in New York are up with objectives of 1290 and 1370 July. Support is at 1250, 1230, and 1210 July, and resistance is at 1300, 1330, and 1360 July. Trends in London are mixed to up with objectives of 346.00 and 362.00 August. Support is at 332.00, 329.00, and 325.00 August, and resistance is at 337.00, 339.00, and 345.00 August.

COCOA
General Comments: Futures closed lower on some speculative selling. July contracts in New York go into delivery on Monday, so speculators are getting out of longs and waiting to reenter in September or December as they want to wait for better prices.. The mid crop harvest is winding down in West Africa and reports are generally positive, although some Nigerian producers have complained that the weather is not giving them the best conditions for top yields. Ivory Coast arrivals are strong as are exports. Demand appears strong. Growing conditions are generally good in West Africa. Periods of showers and cooler temperatures were beneficial, and most in West Africa expect a very good mid crop harvest. Cameroon and Nigeria are reporting less production and prices there are reported strong. Conditions appear good in East Africa and Asia, but East Africa has been a little dry as has Malaysia. Indonesia reported sharply reduced exports for last month.
Overnight News: Scattered showers and storms are expected in West Africa. Temperatures will average near 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 lower today at 4.606 million bags.
Chart Trends: Trends in New York are up with no objectives. Support is at 2470, 2450, and 2400 July, with resistance at 2550, 2580, and 2600 July. Trends in London are up with no objectives. Support is at 1820, 1800, and 1780 July, with resistance at 1860, 1870, and 1900 July.

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