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 sharply lower again yesterday as there was no demand news from China. A catalyst for the recent rally has been the trade deal between the US and China, but China has not yet started to buy and might not buy anything until after the Lunar New Year holiday next week. China has been buying Cotton from the US and Brazil as it needs higher quality Cotton to blend with its domestic production. The market has not been able to move a lot in terms of price for the last month as the US harvest has been ongoing amid some stressful conditions. The harvest is now about over and certified stocks are now leveling off.
Overnight News: The Delta and Southeast should see frequent periods of precipitation over the middle and latter parts of this week. Temperatures should be near to above normal. Texas will have mostly dry conditions except for some rain on Tuesday. Temperatures will average near to above normal. The USDA average price is now 66.79 ct/lb. ICE said that certified stocks are now 6,792 bales, from 6,792 bales yesterday. USDA said that net Upland Cotton export sales were 307,800 bales this year and 13,200 bales next year. Net Pima sales were 20,200 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 6970, 6900, and 6880 March, with resistance of 7140, 7170, and 7190 March.
General Comments: FCOJ closed lower in range bound trading. Futures are still trading at the lower levels of the trading range on the weekly charts but have not been able to move to new lows in the last week. There is a big crop of Oranges out there with not many outlets for consumption. Good growing conditions and increased oranges production estimates by USDA this season have been bearish. The weather has been great for the trees as there have been frequent periods of showers and no severe storms so far this year. Many areas have been dry lately and irrigation is being used. Crop yields and quality should be high for Florida this year as the harvest continues. Inventories of FCOJ in the state are high and are more than 34% above last year. USDA released its mid year citrus fruits update yesterday but there was nothing very newsworthy found in the report.
Overnight News: Florida should get mostly dry conditions after some showers today. Temperatures will average near to above normal. Brazil should get dry conditions through the weekend and near to above normal temperatures. ICE said that 0 notices were posted for delivery against January contracts and that total deliveries for the month are now 4 contracts.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 95.00 March. Support is at 94.00, 92.00, and 89.00 March, with resistance at 98.00, 99.00, and 100.00 March.
General Comments: Futures were higher in both markets. Speculators were the best buyers on ideas the market was oversold and in need of a correction. It has been raining in Brazil and the crop conditions there are still called mostly good to very good. The Brazilian crop is developing well. Brazil offers were said to increase from the country due to the weakness in the Real. It is dry in other parts of Latin America. Central America has had less than normal rains, especially in Honduras. The Asian harvest is underway but producers do not seem to be selling on ideas that prices are too low. Vietnam exports remain behind a year ago, but the market anticipates bigger offers. Vietnamese crops are expected to be big despite uneven growing conditions earlier in the year.
Overnight News: ICE certified stocks are higher today at 2.145 million bags. The ICO daily average price is now 106.56 ct/lb. Brazil will get drier weather this weekend with near to above normal temperatures. Vietnam will see mostly dry conditions.
Chart Trends: Trends in New York are mixed to down with objectives of 105.00 and 100.00 March. Support is at 110.00, 106.00, and 104.00 March, and resistance is at 116.00, 120.00 and 123.00 March. Trends in London are mixed to up with objectives of 1410 and 1450 March. Support is at 1340, 1320, and 1310 March, and resistance is at 1370, 1390, and 1410 March.
General Comments: The markets closed mostly lower in New York and lower in London in correction trading. Brazil could step up its export pricing program due to a weaker US Dollar and the lack of offers from India. Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season. There is still more than enough Sugar for any demand and that India will have to sell sooner or later. Reports from India indicate that the country is seeing relatively good growing conditions and still holds large inventories from last year. However, these supplies are apparently not moving despite relatively strong world prices. Reports of improving weather in Brazil imply good crops there.
Overnight News: Brazil will get drier weather this weekend. Temperatures should be near to above normal.
Chart Trends: Trends in New York are mixed to up with objectives of 1500 and 1540 March. Support is at 1450, 1420, and 1410 March, and resistance is at 1490, 1510, and 1540 March. Trends in London are mixed to up with no objectives. Support is at 403.00, 399.00, and 394.00 March, and resistance is at 412.00, 415.00, and 418.00 March.
General Comments: Futures closed lower in New York and in London. Funds and other speculators were the best sellers in New York and in London on ideas that a correction was needed. The market has moved sharply higher in the past month on ideas of reduced world production but supplies available to the market should be increasing. Harvest is now active in West Africa and the results so far are very good. Ivory Coast arrivals are now estimated at 1.281 million tons, up 1.2% from last year. Ideas are that demand is currently very strong due to the current price action. The reports from West Africa imply that a big harvest is possible in the region. The weather in Ivory Coast is good. The weather is too dry in Nigeria and there are fears that the mid crop is not developing well at this time.
Overnight News: Scattered showers are expected in southern sections of 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 3.039 million bags.
Chart Trends: Trends in New York are mixed to up with no objectives. Support is at 2750, 2730, and 2680 March, with resistance at 2790, 2840, and 2860 March. Trends in London are mixed. Support is at 1960, 1950, and 1930 March, with resistance at 2000, 2030, and 2060 March.