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 lower on fears of global economic slowdowns created by the Coronavirus and the collapse in Crude Oil prices due to the trade war between the Saudis and the Russians. A strong US Dollar was also very negative as the US exports most of its Cotton. The Coronavirus has the chance to hurt trade in Cotton between the US and China. Chinese buyers might need less Cotton now as factories inside their country were closed for an extended holiday. All are reopen now, but the manufacturing pace has been slow. China has also been slow to buy products from Southeast Asia and demand for US Cotton has been hurt in the entire region. The strong US Dollar hurts trade anywhere and pushes buying to alternative growths like Brazil. The US Dollar index was weaker but still gained on the Brazilian Real. Brazil has the quality to compete with the US and the Real is much cheaper than the US Dollar right now.
Overnight News: The Delta and Southeast should see scattered showers. Temperatures should average near to above normal. Texas will have scattered showers. Temperatures will trend to near to below normal. The USDA average price is now 54.52 ct/lb. ICE said that certified stocks are now 40,152 ba1es, from 40,152 bales yesterday. ICE said that 0 notices were posted for delivery against March Cotton contracts and that total deliveries for the month are now 385 contracts
Chart Trends: Trends in Cotton are down with objectives of 5770 May. Support is at 5930, 5900, and 5870 May, with resistance of 6020, 6050 and 6300 May.

DJ On-Call Cotton – Mar 12
As of Mar 6. 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
Mar 20 0 2 -2 27 137 -110
May 20 18,897 19,837 -940 14,421 14,250 171
Jul 20 26,723 26,937 -214 5,253 4,943 310
Oct 20 0 0 0 0 0 0
Dec 20 21,273 21,979 -706 21,854 21,258 596
Mar 21 11,672 10,552 1,120 1,653 1,586 67
May 21 4,480 4,077 403 228 228 0
Jul 21 8,948 7,540 1,408 816 816 0
Dec 21 1,403 1,217 186 2,585 2,361 224
Mar 22 466 466 0 13 13 0
Dec 22 0 0 0 7 7 0
Dec 23 0 0 0 7 7 0
Total 93,862 92,607 1,255 46,864 45,606 1,258
Open Open Change
Int Int
Mar 20 29 69 -40
May 20 105,315 106,729 -1,414
Jul 20 45,796 45,104 692
Oct 20 41 83 -42
Dec 20 47,621 37,653 9,968
Mar 21 8,198 6,943 1,255
May 21 655 671 -16
Jul 21 1,657 1,509 148
Dec 21 1,123 962 161
Mar 22 16 16 0
Dec 22 0 0 0
Dec 23 0 0 0
Total 210,451 199,739 10,712

FCOJ
General Comments: FCOJ was a little higher yesterday. The fundamentals remain bearish but the price action suggests that a rally is possible. 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.
Overnight News: Florida should get mostly dry conditions. Temperatures will average above normal. Brazil should get scattered showers through the weekend and near to above normal temperatures. ICE said that 0 notices were posted against contracts for March delivery and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 96.00, 94.00, and 92.00 May, with resistance at 98.00, 99.00, and 100.00 May.

COFFEE
General Comments: Futures were lower in New York and in London. World economic problems caused by the Coronavirus scare and the drop in Crude Oil prices sent Coffee futures lower. The US Dollar moved sharply higher against other major world currencies and this was bearish for prices as well. 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. Many producers and exporters have run out of Coffee in storage to sell. The chart trends are mixed in New York and down in London due to the big production ideas and could rally in the lack of Brazil and also as Central American supply becomes acute. 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.
Overnight News: ICE certified stocks are lower today at 2.098 million bags. The ICO daily average price is now 105.84 ct/lb. Brazil will get scattered showers, mostly in Minas Gerais, with near normal temperatures. Vietnam will see mostly dry conditions in the south and some light to moderate showers in the north. ICE said that 13 notices were posted for delivery against March contracts and that total deliveries for the month are now 2,159 contracts.
Chart Trends: Trends in New York are mixed. Support is at 105.00, 103.00, and 100.00 May, and resistance is at 114.00, 116.00 and 117.00 May. Trends in London are down with no objectives. Support is at 1220, 1190, and 1150 May, and resistance is at 1260, 1290, and 1310 May.

SUGAR
General Comments: New York and London closed lower again due to weaker petroleum futures. The weaker petroleum futures make higher priced ethanol that much more expensive to blend and cuts demand. Ethanol processing margins are negative at this time. That makes more Sugarcane available for processing into Sugar. The Brazil mills are trying to cover the lack of White Sugar in the market, but the lack of Ethanol demand makes the White Sugar shortage problems kind of mute. Reports indicate that little is on offer from India even after what was reported to be a very good production year. Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season. Reports of good 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 for more processing to Sugar instead of ethanol at this time. Brazil mills reportedly hedged off their Ethanol production so the economic losses due to the recent drop in prices will not be felt.
Overnight News: Brazil will get scattered showers mostly in Minas Gerais. Temperatures should be near normal.
Chart Trends: Trends in New York are down with no objectives. Support is at 1140, 1110, and 1080 May, and resistance is at 1210, 1240, and 1270 May. Trends in London are down with no objectives. Support is at 348.00, 341.00, and 337.00 May, and resistance is at 365.00, 370.00, and 380.00 May.

COCOA
General Comments: New York and London closed lower on the sharply higher US Dollar and world trade concerns. Trends on the daily charts are down and trends remain down on the weekly charts. Funds and other speculators were the best sellers. 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 strong but less than before. 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. Ivory Coast did report its first case of Coronavirus yesterday. 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, but showers are possible in coastal areas. 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 3.793 million bags. ICE said that 0 notices were posted for delivery against March futures and that total deliveries for the month are now 730 contracts.
Chart Trends: Trends in New York are down with objectives of 2450 and 2320 May. Support is at 2480, 2450, and 2420 May, with resistance at 2580, 2630, and 2660 May. Trends in London are mixed to down with no objectives. Support is at 1860, 1840, and 1800 May, with resistance at 1930, 1980, and 2000 May.

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