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 and the charts show that the market is now in a sideways trade near the recent lows. Prices closed a little higher in new crop months as traders become more concerned about planting progress and crop development of this crop. The market did not really react to news that working groups of Chinese and Americans will meet before the G-20 meetings to try to get an agreement between the countries back on track again. The weather has been bad, especially in the Texas Panhandle, where there are concerns that it has been too wet and cool for the crop to be developed well. However, USDA showed good progress and steady condition ratings. The Delta has also been wet and it has been dry in the Southeast, although better rains have been seen lately in this region. Demand is a problem for traders due mostly to moves made in Washington. Cotton is already experiencing lost business potential with China and Turkey. The Indian monsoon is finally getting going so weather concerns for Cotton there will become less.
Overnight News: The Delta and Southeast should get showers today and tomorrow, then drier weather. Temperatures should be mostly near to below normal this week and near to above normal this weekend. Texas will have mostly dry weather. Temperatures will be on both sides of normal. The USDA average price is now 61.22 ct/lb. ICE said that certified stocks are now 97,713 bales, from 95,036 bales yesterday. USDA said that net weekly Upland Cotton export sales were -119,300 bales this year and 221,800 bales next year. Net Pima sales were 4,000 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 6490, 6450, and 6400 July, with resistance of 6700, 6750, and 6850 July.
General Comments: FCOJ was lower as the Florida weather remains generally good for crops. Speculators are rolling or liquidating positions before July goes into delivery at the end of the month. Speculators have been buying in anticipation of the hurricane season, but there are no storms on the horizon this early part in the season. USDA production estimates are above 70 million boxes. Inventories in Florida are still well above a year ago. That means that there should be no shortage of oranges available to the market to make FCOJ. 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 week. Temperatures will average near to above normal. Brazil should get scattered showers today, then drier weather and near normal temperatures.
Chart Trends: Trends in FCOJ are down with objectives of 99.00, 94.00, and 88.00 July. Support is at 97.00, 95.00, and 93.00 July, with resistance at 101.00, 104.00, and 106.00 July.
General Comments: Futures were mixed, with New York higher and London steady to mixed. A strong export pace from Brazil remains a feature as CECAFE last week noted that May exports were well over 3 million bags. The new crop is coming and is a smaller crop, but the supplies from the previous crop are still around and are now getting pushed into the market.. 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, but weather is now called good with showers being reported in the Central Highlands. Buyers are now more actively pursuing other origins, especially for certified or higher end coffees.
Overnight News: ICE certified stocks are near unchanged today at 2.381 million bags. The ICO daily average price is now 96.02 ct/lb. Brazil will get mostly dry conditions with near to above normal temperatures. Vietnam will see scattered showers and storms. ICE New York said that 401 notices were posted against July contracts and that total deliveries for the month are 401 contracts.
Chart Trends: Trends in New York are mixed to down with objectives of 94.00 and 87.00 September. Support is at 96.00, 95.00, and 93.00 September, and resistance is at 99.00, 102.00 and 105.00 September. Trends in London are mixed to down with no objectives. Support is at 1360, 1310, and 1290 September, and resistance is at 1410, 1440, and 1470 September.
General Comments Futures closed a little lower in both markets as the Indian monsoon started to look better. Ideas are that a large part of the Brazilian harvest can be turned into ethanol due to the problems raising Corn in the US. There was some selling pressure on reports that the monsoon in India was getting more active and on statements from the Indian Sugar Association and others that the country still had surplus Sugar to sell. Processing of Brazilian Sugar is faster now with the harvest in full swing. 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 there are signs that the monsoon is ready to develop as rains are now reported in many areas of southern and central India. 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.
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 mixed to up with objectives of 1290, 1300, and 1330 October. Support is at 1260, 1250, and 1240 October, and resistance is at 1290, 1310, and 1350 October. Trends in London are mixed to down with objectives of 333.00 and 327.00 October. Support is at 336.00, 333.00, and 330.00 October, and resistance is at 343.00, 345.00, and 347.00 October.
General Comments: Futures closed a little higher and trends are starting to turn up again in New York. The market still appears to be mostly a demand led rally market, but there are signs of slightly lower production in West Africa. The disease in Ghana could hurt the mid crop and probably will affect the next main crop that will be harvested at the end of the year. The mid crop harvest is winding down in West Africa and reports are generally positive. Otherwise, the weather is called good with above average rains reported in Ivory Coast last week. Ivory Coast arrivals are strong as are exports. The weekly arrivals pace is about 15% higher than a year ago and is holding this level. Demand appears strong. Conditions appear good in East Africa and Asia, but East Africa has been a little dry as has Malaysia.
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 4.572 million bags. ICE said that 79 contracts were delivered against July futures today and that total deliveries for the month are 342 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 2600 and 2700 September. Support is at 2500, 2470, and 2450 September, with resistance at 2530, 2550, and 2580 September. Trends in London are mixed. Support is at 1830, 1810, and 1790 September, with resistance at 1860, 1870, and 1910 September.