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 closed lower on follow through speculative selling. The USDA reports released Tuesday were considered neutral to negative for futures prices. The weather has improved after a couple of hurricanes hit the Delta and Southeast. It remains dry in West Texas. Harvest is ongoing so increased rains now can only delay things and not improve conditions much. Increased rains can hurt Cotton quality, but so far the quality appears to be good. The weekly export sales report showed weaker demand. Demand should stay generally weak as long as the Coronavirus is around. Shopping is hard to do and many people are still unemployed. India is also harvesting under what appear to be good conditions. Good production is expected.
Overnight News: The Delta and Southeast will get mostly dry conditions. Temperatures should average near to above normal in the Delta and in the Southeast. Texas will have mostly dry conditions and above normal temperatures. The USDA average price is now 65.74 ct/lb. ICE said that certified stocks are now 83,423 bales, from 78,474 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 6860, 6810, and 6780 December, with resistance of 7040, 7110 and 7180 December.
General Comments: FCOJ was a little higher on follow through speculative buying. Futures are now testing the next resistance area just above 118.00 on the charts. Tropical Storm Eta did little damage to fruit or trees as it passed near the coast of southern and western Florida. It will cross the northern part of the state this weekend starting out as a hurricane. Florida has been spared any hurricanes or other serious storms this year in a year that has been very active for tropical storms. The Coronavirus is still promoting consumption of FCOJ at home. Restaurant and food service demand has been much less as no one is really dining out. Florida production prospects for the new crop were hurt by an extended flowering period, but the weather is good now with frequent showers to promote good tree health and fruit formation. Brazil has been too dry and irrigation is being used. Showers are falling in Brazil now and these need to continue to ensure good tree health. Mexican crop conditions are called good with rains.
Overnight News: Florida should get isolated showers. Temperatures will average near to above normal. Brazil should get scattered showers and near to above normal temperatures. ICE said that 0 notices were posted for delivery against November contracts and that total deliveries for the month are 0 contracts.
Chart Trends: Trends in FCOJ are mixed to up with objectives of 121.00 January. Support is at 116.00, 113.00, and 112.00 January, with resistance at 118.00, 121.00, and 122.00 January.
General Comments: Futures were higher in New York and in London. Trends turned up in London on the daily charts. London has been better supported due to stronger demand ideas and worries about the weather in Vietnam as the country is getting too much rain now and flooding is being reported in the Central Highlands. The rains should continue for another week or so, then the weather should turn better with drier conditions. The demand from coffee shops and other food service operations is still at very low levels as consumers are still drinking Coffee at home. Reports indicate that consumers at home are consuming blends with more Robusta and less Arabica. The Brazil harvest is over and producers are selling. Ideas are that production is very strong this year as it is the on year for the trees. Central America is also offering right now and offers are increasing. It has been very wet in Central America due to a hurricane late last week. The weather is good in Colombia but a little dry in Peru.
Overnight News: ICE certified stocks are higher today at 1.192 million bags. The ICO daily average price is now 107.71 ct/lb. Brazil will get scattered showers with near to above normal temperatures. Central America will get scattered showers after a hurricane earlier this week. Vietnam will see some big rains.
Chart Trends: Trends in New York are mixed. Support is at 108.00, 104.00, and 102.00 December, and resistance is at 111.00, 112.00 and 115.00 December. Trends in London are up with objectives of 1410 January. Support is at 1370, 1340, and 1330 January, and resistance is at 1400, 1420, and 1430 January.
General Comments: New York and London were lower in range trading. Coronavirus has returned to the US and Europe and has caused some demand concerns for both Sugar and Ethanol. Brazil mills have been producing more Sugar and less Ethanol due to weak world and domestic petroleum prices. Petroleum prices have rebounded lately but remain at low levels overall. About 45% of the crush this year will go to Sugar, from 35% last year. Scattered showers are falling now to improve Sugarcane growing conditions in Brazil, but southern areas remain too dry. India has a very big crop of Sugarcane this year. The Indian government will not announce the subsidy for exporters of Sugar so prices will need to rally in the world market before exporters can become involved and start selling. Thailand might have less this year due to reduced planted area and erratic rains during the monsoon season. Rains are moving through the country now from Vietnam and the Pacific. The EU is having problems with its Sugarbeets crop due to weather and disease.
Overnight News: Brazil will get scattered showers. Temperatures should average above normal.
Chart Trends: Trends in New York are mixed. Support is at 1430, 1400, and 1370 March, and resistance is at 1480, 1500, and 1530 March. Trends in London are mixed. Support is at 391.00, 384.00, and 381.00 March, and resistance is at 406.00, 409.00, and 412.00 March.
DJ Brazil Center-South Sugar Crush Down 18.3% at 26.8M Tons in 2H Oct., Unica Says
By Jeffrey T. Lewis
SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed less cane in the second half of October compared with a year earlier, as dry weather earlier in the season accelerated processing of the crop.
Center-south mills crushed 26.8 million metric tons of cane in the period, a decline of 18.3% from the same period a year earlier, according to industry group Unica. They produced 1.7 million tons of sugar, up 14.4%, and made 1.5 billion liters of ethanol, down 26.9% from a year earlier.
The production mix for the second half of October was 43.6% sugar to 56.4% ethanol, compared with 32% sugar and 68% ethanol in the same period a year ago.
In the season from April 1 through Nov. 1, mills in the region crushed 564.9 million tons of cane, up 3.7% from the same period a year earlier. Sugar production jumped 44% to 36.4 million tons, and ethanol output fell 8.8% to 27.1 billion liters.
The lack of rain in many cane-producing areas of the center south in earlier months eased work in the fields and permitted mills to speed up processing compared with earlier years.
The production mix for the season through Nov. 1 was 46.7% sugar to 53.3% ethanol, compared with 35% sugar and 65% ethanol in the same period a year ago.
General Comments: New York and London were mostly lower as demand concerns continue. The weekly charts show that down trends are still in place, but daily chart trends are sideways. The harvest for the next main crop is almost done for much of West Africa and very strong production is expected. There are a lot of demand worries as the Coronavirus is making a comeback in the US. Europe is also seeing a return of the pandemic.
Overnight News: 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 scattered showers and near to above normal temperatures. ICE certified stocks are lower today at 3.301 million bags.
Chart Trends: Trends in New York are mixed. Support is at 2320, 2290, and 2240 December, with resistance at 2420, 2470, and 2500 December. Trends in London are mixed. Support is at 1570, 1540, and 1510 December, with resistance at 1630, 1650, and 1670 December.