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 lower as trade tensions with China ramped up in response to the Coronavirus and the need for the president and some members of Congress to find someone else to blame the outbreak in the US on. Wire reports indicate that the US is actively looking for ways to retaliate for what it feels was a delayed response that under reported the actual virus conditions. Blaming China for the problem could really hurt demand for US Cotton as China remains a major world buyer. The world is starting to slowly recover from the Coronavirus scare and some stores are starting to open again after being closed for weeks. The hope is that consumer demand for Cotton products will quickly return, but this is not likely to be the case. Consumers have really been hurt economically due to stay at home orders imposed here and overseas and it will take some time for them to recover. As an example, Chinese stores have been open for several weeks but there has been no consumer rush to go to them and buy. The same is possible here and in Europe. It is getting too dry in Brazil for good growth of the second crop.
Overnight News: The Delta and Southeast will get mostly dry conditions, but a few showers are possible on Friday. Temperatures should be mostly near to below normal in the Southeast and near to above normal in the Delta. Texas will have dry conditions through the weekend. Temperatures will average near to above normal. The USDA average price is now 48.87 ct/lb. ICE said that certified stocks are now 3,579 bales, from 3,579 bales yesterday. ICE said that 0 notices were posted for delivery against May contracts and that total deliveries for the month are now 10 contracts.
Chart Trends: Trends in Cotton are down with objectives of 5310 and 4970 July. Support is at 5340, 5300, and 5090 July, with resistance of 5580, 5660 and 5800 July.
General Comments: FCOJ was higher and trends are still up in the market. Support is coming from the continued effects from the Coronavirus that are keeping people at home and drinking Orange Juice. Demand from grocery stores has remained strong in response to the increased consumer demand. Supplies available to the market are somewhat reduced. Inventories in cold storage remain solid so there will be FCOJ to meet the demand. The weather in Florida has become a mixed bag over the last few weeks. It had been very hot and dry in south Florida but the north got a lot of rain. The south has now turned cooler but remains mostly dry. The midseason Oranges harvest is diminishing. Irrigation has been run several times per week in most areas. Color break is reported on late variety Oranges. More signs of early bloom and new growth on trees are reported. Favorable weather is reported in Brazil but current dry conditions are increasing irrigation needs.
Overnight News: Florida should get mostly dry conditions. Temperatures will average near normal. Brazil should get isolated showers and near to above normal temperatures.
Chart Trends: Trends in FCOJ are mixed to up with objectives of 123.00 July. Support is at 115.00, 112.00, and 111.00 July, with resistance at 118.00, 121.00, and 124.00 July.
General Comments: Futures were higher in New York and in London as London. New York was higher as some states in the US started to lift their Coronavirus restrictions that have depressed consumer and roaster demand in the US and Europe. The demand from coffee shops and other food service operations has dropped to almost nothing. Consumers are still drinking Coffee at home, but many smaller roasters are actively trying to unload green coffee already bought a there are no outlets for sales at this time. The logistics of moving Coffee from Central and South America remain difficult. Producers have had trouble getting workers to pick the cherries and mills and processors have had trouble getting workers to staff the plants. Shipping logistics have improved somewhat, but many are still having trouble getting the Coffee to ports to move to consumer nations.
Overnight News: ICE certified stocks are lower today at 1.806 million bags. The ICO daily average price is now 106.65 ct/lb. Brazil will get dry conditions or isolated showers with near to above normal temperatures early in the week and near to below normal temperatures by this weekend. Vietnam will see light to moderate showers. ICE said that 0 notices were posted for delivery against May futures and that total deliveries for the month are now 438 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 113.00 and 118.00 July. Support is at 107.00, 103.00, and 102.00 July, and resistance is at 112.00, 115.00 and 119.00 July. Trends in London are mixed. Support is at 1190, 1150, and 1110 July, and resistance is at 1210, 1230, and 1250 July.
General Comments: New York and London closed higher in sympathy with the higher prices in world petroleum markets. Prices in petroleum futures still have a long way to go before Ethanol processing becomes profitable again, but prices in the sector seem to be trending higher. More Sugarcane is now available for processing into Sugar. The Brazil mills are trying to cover the lack of White Sugar in the market and have shifted to Sugar at the expense of Ethanol production due to the difference in prices and profitability. Reports indicate that little is on offer from India in part due to logistical and harvest problems caused by the Coronavirus. Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average near normal.
Chart Trends: Trends in New York are mixed to up with objectives of 1320 and 1420 October. Support is at 1060, 1050, and 1020 October, and resistance is at 1120, 1160, and 1180 October. Trends in London are up with objectives of 379.00 and 408.00 August. Support is at 340.00, 328.00, and 323.00 August, and resistance is at 361.00, 367.00, and 387.00 August.
General Comments: New York mostly a little higher and London closed lower. New York May was lower along with all the moths in London. The Coronavirus has complicated farming and marketing efforts. Ideas are that deliveries can be slower on any contracted Cocoa and that the next crop could suffer as workers stay away. The Coronavirus helps keep demand away and helps keep workers from grinding facilities and chocolate manufacturers. Harvest is now over for the main crop in West Africa and the results so far are very good. Ideas are that demand is less than before due to the Coronavirus problems in Europe, but Europe and North America are now starting to slowly reopen and demand can increase. The reports from West Africa imply that a big harvest in the region, but there are indications that earlier dry weather could affect yields. The weather in Ivory Coast and the rest of West Africa currently is good. Brazil could be seeing stress from dry conditions.
Overnight News: Isolated to scattered showers are forecast for West Africa. Temperatures will be 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 4.335 million bags. ICE said that 0 notices were posted for delivery against May NY contracts and that total deliveries for the month are now 95 contracts.
Chart Trends: Trends in New York are mixed. Support is at 2340, 2310, and 2300 July, with resistance at 2420, 2520, and 2580 July. Trends in London are mixed. Support is at 1860, 1850, and 1820 July, with resistance at 1920, 1950, and 1970 July.
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