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 mostly higher and trends are up on the charts. There was general buying in all ag markets yesterday on ideas that ag markets in general have seen lows. Buying also surfaced as USDA showed better than expected demand potential in its monthly supply and demand updates. Production was estimated in line with trade expectations. The result was that ending stocks did not change from last month. Many analysts had looked for ending stocks projections to increase and some of the bigger name Cotton market analysts had expected a significant jump in ending stocks. The fact that USDA left ending stocks unchanged was bullish against expectations although the ending stocks projections remain large by any measure. Demand remains a problem for the market as the weekly export sales reports have not been strong. The weaker current demand should be enough to keep prices from going very high but the charts offer hopes that futures could eventually trade to 69 cents per pound basis December futures.
Overnight News: The Delta should see showers later in the week in northern and western areas and Southeast should see dry conditions. Temperatures should be mostly above normal. Texas will have dry conditions. Temperatures will be above normal. The USDA average price is now 57.88 ct/lb. ICE said that certified stocks are now 11,190 bales, from 11,191 bales yesterday.
Chart Trends: Trends in Cotton are up with objectives of 6650, 6910, and 6920 December. Support is at 6170, 6020, and 5980 December, with resistance of 6290, 6400, and 6470 December.

Crop Progress
Date 15-Sep 8-Sep 2018 Avg
Cotton Bolls Opening 54 43 48 47
Cotton Harvested 9 7 13 8
Crop Condition
Very Poor Fair Good Excellent
Cotton This Week 3 14 42 34 7
Cotton Last Week 3 15 39 37 6
Cotton Last Year 8 24 29 30 9

FCOJ
General Comments: FCOJ was little changed and mixed yesterday. Traders were keeping a close eye on a couple of storms that could hit Florida. One appeared on track to curve back away from the state and northeast into the Atlantic. One was still farther east and was still forming and determining its track. It is the high point in the hurricane season and forecasters were already watching a new system trying to form in the Atlantic. Chart patterns are mixed in response to the hurricane threats and the potential for more systems to form in the short-term. The weather in Florida had been good as the state has seen frequent showers and storms that have aided in development in the fruit. Inventories in Florida are still well above a year ago. Fruit for the next crop is developing and are as big as baseballs. Crop conditions are called good.
Overnight News: Florida should get mostly dry conditions today, then chances for showers and storms though the weekend. Temperatures will average near to above normal. Brazil should get mostly dry weather and near to below normal temperatures. ICE said that 0 notices were posted for delivery against September FCOJ contracts and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 101.00, 98.00, and 97.00 September, with resistance at 105.00, 108.00, and 110.00 September.

COFFEE
General Comments: New York and London were both higher on buying that was seen in most ag markets. Some of the buying came in response to the bombing of the refineries in Saudi Arabia, but most of the buying is coming on ideas that most ag markets including Coffee have found bottoms. The weather is still a problem in Brazil. The Arabica growing areas are waiting for rains to restart flowering after some rains earlier in the year. Vietnam crops are thought to be big despite some uneven growing conditions this year. It has been warm and dry at times, then the growing areas have seen some very heavy rains. Demand has been increasing over the last few years on the consumer level, but production potential is growing faster. The general overproduction means that producers in Brazil and Vietnam have the best chances to make money at current prices as they have more mechanized farming. The rest of the Coffee origin world will struggle due to more difficult growing terrain and higher costs of production. The weaker production this year should help to hold prices from going much lower and the price action from last week implied that futures have found a low value for now.
Overnight News: ICE certified stocks are lower today at 2.312 million bags. GCA stocks are 7.224 million bags, from 7.099 million in July. The ICO daily average price is now 100.29 ct/lb. Brazil will get mostly dry conditions with near normal temperatures. Vietnam will see scattered showers and storms mostly in the north. ICE said that 0 notices were posted for delivery against September contracts and that total deliveries for the month are now 491 contracts.
Chart Trends: Trends in New York are mixed to up with no objectives. Support is at 100.00, 98.00, and 97.00 December, and resistance is at 105.00, 106.00 and 108.00 December. Trends in London are mixed. Support is at 1300, 1290, and 1260 November, and resistance is at 1340, 1360, and 1370 November.

BFW 01/17 11:00 Brazil 2019 Coffee Output Seen at 50.5m-54.5m Bags, Conab Says
________________________________________
Brazil Conab Cuts 2019 Coffee Output Amid Adverse Weather
2019-09-17 12:00:01.0 GMT
By Fabiana Batista
(Bloomberg) — Nation’s farmers may collect 49m bags in the
current season, down from a previous estimate of 50.9m bags,
government agency Conab said by email in its 3rd forecast for
2019 season.
* The estimate was cut mainly because of the adverse weather in
arabica crop, which was affected by high temperatures and dry
conditions during bean development
** That’s a decline of 20.5% from 61.7m bags harvested last
year, when crops were at higher-yielding half of a biennial
cycle
* Arabica coffee output was reduced to 34.5m bags versus 37m
bags seen in the previous estimate; in 2018, the harvest was
47.5m bags
* Robusta coffee estimate was raised to 14.5m bags from previous
estimate of 13.9m bags; that’s up from 2018’s 14.2m bags
* NOTE: Brazil is world’s biggest coffee producer and exporter;
a bag weighs 60 kilograms (132 pounds)
To contact the reporter on this story:
Fabiana Batista in Sao Paulo at fbatista6@bloomberg.net
To contact the editors responsible for this story:
James Attwood at jattwood3@bloomberg.net
Leonardo Lara

SUGAR
General Comments: New York and London both closed higher on ideas that demand for Sugar based ethanol could increase because of the bombings of Saudi oil refineries. The refineries produced about half of the crude oil for Saudi Arabia and about 5% of the world total. London also got support from reports of poor yields for Sugar beets in Europe and Russia. World supplies still appear ample for the demand potential, but the supply situation could tighten if the Saudi refineries are badly damaged and take some time to come back on-line. The production of ethanol could be increased to take up some of the oversupply of Sugar. Reports from India indicate that the country still has a large surplus of White Sugar that probably must be exported. India is reporting very good monsoon rains and production prospects for this year are strong. Brazil mills are refining mostly for ethanol right now as has been the case all season. The fundamentals still suggest big supplies, and the weather in Brazil is good enough and India has improved to support some of the big production ideas. The weather has been much more uneven in production areas from Russia into western Europe. Those areas had a very hot and dry start to the growing season. Better weather was seen in early August then it turned hot and dry again. These areas need more rain and some cooler weather to provide better conditions for the final development of the crops.
Overnight News: Brazil will get mostly dry weather. Temperatures should be near normal. USDA said that Sugar beets are now 8% harvested, from 11% last year and 9% average.
Chart Trends: Trends in New York are mixed to up with no objectives. Support is at 1210, 1200, and 1190 March, and resistance is at 1250, 1270, and 1300 March. Trends in London are up with no objectives. Support is at 320.00, 317.00, and 314.00 December, and resistance is at 331.00, 335.00, and 337.00 December.

COCOA
General Comments: Futures closed higher on follow through speculative buying. Trends are up in both markets. London appears to be the stronger market right now. The market could start to act weaker as the next main crop harvest comes closer to reality in West Africa. Some initial harvesting is being reported in Nigeria, but most areas will not start the harvest just yet. The weather in Ivory Coast has improved due to reports of frequent showers. The precipitation is a little less now so there are no real concerns about disease. Ideas are that the next crop will be good. Growing and harvesting conditions in Asia are also reported to be good. The harvest is ongoing amid somewhat drier weather.
Overnight News: Scattered showers and storms are expected in West Africa. Temperatures will be on both sides of 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 3.882 million bags. ICE said that 0 notices were posted for delivery against September contracts and that total deliveries for the month are now 2,125 contracts.
Chart Trends: Trends in New York are up with objectives of 2420 December. Support is at 2320, 2280, and 2230 December, with resistance at 2400, 2430, and 2460 December. Trends in London are up with objectives of 1970 December. Support is at 1790, 1760, and 1740 December, with resistance at 1830, 1850, and 1870 December.

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