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

MORNING SOFTS COMMENTS
Jack Scoville

Wednesday, February 26, 2020

Price Futures Group, CBOT
Chicago, IL
(312) 264-4322
jscoville@pricegroup.com

JSL, SA de CV
San Salvador, El Salvador (503) 2260-7806 jslsadecv@comcast.net

JSL, SA
jslsa@comcast.net

COTTON
General Comments: Cotton was sharply lower in reaction to news of the spread of the Caronavirus and in reaction to the sharp drop for the second day in the stock markets. The virus has now spread to South Korea, Italy, and Iran. The spread created new fears about the health of the world economy and that meant the potential for less demand for US Cotton. The number of new cases being reported inside China continues to drop. Big buying from China could rally the market, but futures have already moved significantly higher in anticipation of any Chinese buying and the actual buying could become anti climatic. The Coronavirus has the chance to hurt trade in Cotton between the two countries. Chinese buyers might need less Cotton now as factories inside the country were closed for an extended holiday. All are reopen now, but the manufacturing pace has been slow.
Overnight News: The Delta and Southeast should see some big rains today and tomorrow. Temperatures should average near to below normal after smow Warmer days today and tomorrow. Texas will have mostly dry weather. Temperatures will trend to below normal. The USDA average price is now 60.98 ct/lb. ICE said that certified stocks are now 35,905 ba1es, from 34,062 bales yesterday. ICE said that 10 notices were posted for delivery against March Cotton contracts and that total deliveries for the month are now 295 contracts.
Chart Trends: Trends in Cotton are down with objectives of 6860 and 6270 May. Support is at 6600, 6540, and 6520 May, with resistance of 6730, 6770 and 6810 May.

FCOJ
General Comments: FCOJ was lower on follow through selling tied to the Coronavirus news. It has spread to South Korea, Italy, and Iran and it is this spread that is causing fears of a global economic decline. The reports of new cases inside China are on the decline. 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. Inventories of FCOJ in the state are high and are more than 26% above last year.
Overnight News: Florida should get mostly dry conditions except for some scattered showers on Wednesday. Temperatures will average near to above normal through Wednesday, then near to below normal. Brazil should get scattered showers through the weekend and near to above normal temperatures.
Chart Trends: Trends in FCOJ are mixed. Support is at 96.00, 95.00, and 92.00 March, with resistance at 100.00, 101.00, and 102.00 March.

DJ Florida FCOJ Movement and Pack – Feb 26
Florida FCOJ Movement And Pack
In mm ps, (million pounds solid). Source: Florida Department of Citrus (FDOC)
WEEK ENDING:
2/8/2020 Corresponding

Pack
Bulk 3.86 6.58 -41.3%
Retail/Institutional 1.31 0.40 225.2%
Total Pack 5.17 6.98 -26.0%
Reprocessed -3.43 -2.48 38.5%
Pack from Fruit 1.74 4.50 -61.4%
Receipts & Losses
Net Gain or Loss -0.39 -0.05 741.1%
Imports – Foreign 8.19 5.21 57.3%
Domestic Receipts 0.16 0.13 24.9%
Receipts of Florida Product
from Non-Reporting Entit 0.00 0.00 NC
Chilled OJ used in FCOJ 0.18 1.07 -83.3%
Reprocessed FCTJ 0.13 0.14 -4.0%
Total Carry Over, Receipt & Pack
Bulk 307.15 246.83 24.4%
Retail/Institutional 8.04 6.45 24.6%
Total 315.18 253.28 24.4%
MOVEMENT
Bulk
Domestic 5.09 5.14 -1.1%
Exports 0.41 0.15 166.6%
Total (Bulk) 5.50 5.30 3.8%
Retail/Institutional
Domestic 1.06 0.85 24.3%
Exports 0.00 0.00 NC
Total (Retail/Inst) 1.06 0.85 24.3%
Total Movement 6.55 6.15 6.6%
ENDING INVENTORY
Bulk 301.65 241.53 24.9%
Retail/Institutional 6.98 5.60 24.6%
Ending Inventory 308.63 247.13 24.9%
Total Same
Total Season Period Last
To Date Season
8-Feb-20 9-Feb-19 % Change
CARRY OVER, RECEIPT & PACK
Carry Over
Bulk 311.95 237.21 31.5%
Retail/Institutional 5.82 5.92 -1.6%
Total 317.77 243.13 30.7%
Pack
Bulk 62.68 56.67 10.6%
Retail/Institutional 23.54 21.72 8.4%
Total Pack 86.22 78.39 10.0%
Reprocessed -43.16 -44.47 -2.9%
Pack from Fruit 43.06 33.93 26.9%
Receipts & Losses
Net Gain or Loss -1.32 -0.93 43.0%
Imports – Foreign 40.34 82.90 -51.3%
Domestic Receipts 7.28 1.34 442.4%
Receipts of Florida Product
from Non-Reporting Entit 0.15 0.04 323.8%
Chilled OJ used in FCOJ 9.34 1.31 613.3%
Reprocessed FCTJ 0.64 0.42 54.3%
Total Carry Over, Receipt & Pack
Bulk 387.90 334.50 16.0%
Retail/Institutional 29.36 27.63 6.2%
Total 417.26 362.14 15.2%
MOVEMENT
Bulk 81.06 86.66 -6.5%
Domestic 5.19 6.31 -17.8%
Exports 86.25 92.97 -7.2%
Total (Bulk)
Retail/Institutional
Domestic 22.38 22.03 1.6%
Exports 0.00 0.00 NC
Total (Retail/Inst) 22.38 22.03 1.6%
Total Movement 108.63 115.00 -5.5%
ENDING INVENTORY
Bulk 301.65 241.53 24.9%
Retail/Institutional 6.98 5.60 24.6%
Ending Inventory 308.63 247.13 24.9%

COFFEE
General Comments: Futures were higher in New York and in London as there was no real new Coronavirus news released during the session. The CD warned Americans after the Coffee close that a pandemic was coming and to be prepared. Stocks went sharply lower on the news but ag markets were closed or held steady. Futures remain in trading ranges for now. Support came from a lack of supply in Brazil at this time and on concern that previous bad growing conditions have hurt production potential in the Cerrado, home of about 10% of all Brazil production.. Rains and showers were reported in Brazil Coffee areas over the weekend. 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 lower today at 2.156 million bags. The ICO daily average price is now 104.69 ct/lb. Brazil will get scattered showers with near to below normal temperatures. Vietnam will see mostly dry conditions in the south and some light to moderate showers in the north. ICE said that 8 notices were posted for delivery against March contracts and tat total deliveries for the month are now 1,216 contracts.
Chart Trends: Trends in New York are mixed. Support is at 105.00, 102.00, and 100.00 May, and resistance is at 111.00, 112.00 and 114.00 May. Trends in London are mixed. Support is at 1260, 1230, and 1200 May, and resistance is at 1300, 1320, and 1340 May.

SUGAR
General Comments: New York and London closed mixed. Any market moving Coronavirus news was released after the close, but petroleum markets were generally lower during the day. Reports indicate that little is on offer from India. Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season. Losses in both countries would affect the White Sugar market in London more than New York. Reports of improving weather in Brazil imply good crops there. Farmers have been selling to mills but the harvest is now almost over so the supplies will start to tail off. Brazil mills continue to favor ethanol in the production mix, but current higher prices for Sugar make it economic to open more processing to Sugar instead of ethanol at this time.
Overnight News: Brazil will get scattered showers. Temperatures should be near to below normal through Thursday, then near to above normal.
Chart Trends: Trends in New York are mixed. Support is at 1470, 1450, and 1430 May, and resistance is at 1520, 1530, and 1560 May. Trends in London are mixed. Support is at 410.00, 404.00, and 396.00 May, and resistance is at 424.00, 425.00, and 435.00 May.

COCOA
General Comments: New York closed mixed and London closed a little lower as the news about any further spread of the Caronavirus came after the close. The spread of the virus to other countries created new fears of trouble for the world economy. Harvest is now almost over for the main crop in West Africa and the results so far are very good. 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. Ivory Coast arrivals are strong and are above year ago levels. The weather in Ivory Coast is good. The weather is too dry in Ghana and Nigeria and there are fears that the mid crop is not developing well at this time.
Overnight News: Mostly dry conditions are forecast for West Africa. Temperatures will be 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 higher today at 3.664 million bags. ICE said that 0 notices were posted for delivery against March futures and that total deliveries for the month are now 55 contracts.
Chart Trends: Trends in New York are down with objectives of 2720 and 2600 May. Support is at 2770, 2740, and 2700 May, with resistance at 2830, 2890, and 2920 May. Trends in London are mixed. Support is at 1990, 1940, and 1930 May, with resistance at 2030, 2070, and 3000 May.

141 W. Jackson Blvd. Suite 1920, Chicago, IL 60604 | (800) 769-7021 | (312) 264-4322 (Direct) | www.pricegroup.com
Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures.
The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author.
To SUBSCRIBE to Morning Softs please click here.

To Unsubscribe from Morning Softs please click here.

Click Here to View the Morning Softs Archives

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