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:  Futures were higher once again on demand hopes.  Demand has been strong even with the Coronavirus around and getting worse.  The overall weaker US Dollar has helped demand ideas as well although the Dollar has started to firm recently.  The US stock market has been generally firm to help support ideas of a better economy here and potentially increased demand for Cotton products.  Production was rated as less in the most recent USDA production reports so supplies could turn tight if the demand remains strong.  Talk is around regarding the planted area for the next crop.  Producers in Texas might decide to plant Sorghum instead of Cotton due to the relatively strong prices in Sorghum.  Chinese demand for Sorghum has been very strong to cause the higher prices.

Overnight News:  The Delta will get mostly isolated showers and below normal temperatures and Southeast will get mostly dry conditions and near normal temperatures.  Texas will have scattered showers and much below temperatures.  The USDA average price is now 85.41 ct/lb.  ICE said that certified stocks are now 100,326 bales, from 100,326 bales yesterday.  USDA said that net weekly Upland Cotton export sales were 119,500 bales this year and 2,100 bales next year.  Net Pima export sales were 14,600 bales this year and 0 bales next year.

Chart Trends:  Trends in Cotton are mixed to up with no objectives.  Support is at 8710, 8670, and 8450 March, with resistance of 8960, 9020 and 9080 March.

 

DJ On-Call Cotton – Feb 18 

As of Feb 12. 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 21        6,490    13,509   -7,019      3,111     5,633  -2,522

May 21       31,116    28,212    2,904      4,798     4,075     723

Jul 21       36,174    36,395     -221      6,057     6,170    -113

Oct 21            0         0        0          0         0       0

Dec 21       15,646    14,498    1,148     18,408    18,514    -106

Mar 22        5,087     5,066       21      1,641     1,573      68

May 22        1,625     1,475      150        612       362     250

Jul 22        5,096     4,796      300      1,575     1,581      -6

Dec 22        1,419     1,419        0      4,608     3,423   1,185

Mar 23           26        26        0          0         0       0

May 23           18        18        0          0         0       0

Jul 23           18        18        0        220       220       0

Dec 23            0         0        0        227       227       0

May 24            0         0        0        441       441       0

Total       102,715   105,432   -2,717     41,698    42,219    -521

Open      Open   Change

Int       Int

Mar 21       17,517    69,043  -51,526

May 21      113,551    87,328   26,223

Jul 21       55,322    47,329    7,993

Oct 21           17        15        2

Dec 21       49,272    39,332    9,940

Mar 22        6,083     5,623      460

May 22        1,106       777      329

Jul 22        2,452     2,304      148

Dec 22        2,607     2,370      237

Mar 23            0         0        0

May 23            0         0        0

Jul 23            1         1        0

Dec 23            0         0        0

May 24            0         0        0

Total       247,928   254,122   -6,194

 

DJ USDA FORUM: U.S. Cotton Outlook – Feb 19 

Arlington, Va. (Dow Jones)–Data from 2021 USDA Agricultural Outlook Forum, February 19, 2021.

U.S. Cotton Area, Yield, and Production

2020/21 and 2021/22 proj.

(million bales)

2020/21  2021/22  Change

Planted area       mil. acres    12.09    12.00   -0.7

Harvested area     mil. acres     8.70    10.00   14.9

Abandonment rate       %          28.0     16.7  -11.3

Yield/harvested acre lbs./acre     825      840    1.8

Production         mil. bales    14.95    17.50   17.1

2020/21   2021/22   Change

Percent

Beginning Stocks mil. bales     7.3       4.3    -40.7

Area Harvested   mil. HA        3.5       4.0     14.7

Production       mil. bales    15.0      17.5     17.0

Imports          mil. bales     0.0       0.0      0.0

Total Supply     mil. bales    22.2      21.8     -1.8

Exports          mil. bales    15.5      15.5      0.0

Use              mil. bales     2.4       2.5      4.2

Total Use        mil. bales    17.9      18.0      0.6

Ending Stocks    mil. bales     4.3       3.8    -11.6

Stock to Use %      %          24.0      21.1    -12.1

Farm Price       cents/lb.     68.0      75.0     10.3

 

DJ USDA FORUM: World Cotton Balance Sheet – Feb 19 

ARLINGTON, Va. (Dow Jones)– Data from 2021 USDA Agricultural Outlook forum, February 19, 2021

World Cotton Balance Sheet     World Cotton Supply and Demand

2020/21 est. and 2021/22 proj.

2020/21     2021/22    Change

Mln Bales   Mln Bales   Percent

Beginning Stocks                 91.2      88.1     -3.4

Area Harvested mil. HA           32.3      33.2      2.9

Production                      114.1     119.5      4.7

Imports                          43.9      43.9      0.1

Total Supply                    205.3     207.6      1.1

Exports                          43.9      43.9      0.1

Use                             117.2     122.0      4.1

Total Use                       117.3     122.0      4.0

Ending Stocks                    95.7      93.2     -2.6

Stock to Use%                    81.7      76.4     -6.4

China Cotton Balance Sheet     China Cotton Supply and Demand

2020/21 est. and 2021/22 proj.

2020/21    2021/22     Change

Mln Bales  Mln Bales   Percent

Beginning Stocks                  36.9       37.3       1.0

Area Harvested mil. HA             3.3        3.2      -0.8

Production                        29.0       27.5      -5.2

Imports                           11.0       11.0       0.0

Total Supply                      76.9       75.8      -1.5

Exports                            0.1        0.1       0.0

Use ”                             39.5       40.5       2.5

Total Use                         39.6       40.6       2.5

Ending Stocks                     37.3       35.1      -5.7

State Reserve                     12.3       11.7      -4.9

Stock to Use%                     93.8      86.2       -8.0

 

FCOJ 

General Comments:  FCOJ closed lower as the cold weather might have damaged production potential in Texas and Mexico is already part of the price.  Some damage to leaves and open flowers was possible, but ideas are that the overall damage was minor.  Trends are trying to turn up on the daily and weekly charts.  Freezing temperatures were reported in Florida last week but were not cold enough for a long enough time to damage any crops.  Temperatures are more moderate this week.  The weather in Florida is good with a few showers to promote good tree health and fruit formation.  Showers are falling in Brazil now and crop conditions are called good.  Mexican crop conditions otherwise are called good with rains, but earlier dry weather might have hurt production.

Overnight News:  Florida should get scattered showers.  Temperatures will average near to above normal.   Brazil should get isolated showers and near to above normal temperatures.

Chart Trends:  Trends in FCOJ are mixed to down with objectives of 106.00 and 101.00 March.  Support is at 109.00, 108.00, and 103.00 March, with resistance at 112.00, 115.00, and 117.00 March.

 

COFFEE   

General Comments:  Futures were higher once again in New York on ideas of less offer from Brazil and higher in London as Vietnam producers stopped selling during the Tet holiday.  Tet is now over but selling is slow to resume.  There are reports of good weather in Vietnam for the harvest.  Indonesia has had good weather but has little coffee to sell now.  Brazil has been dry for flowering and initial fruit development and it has been warm and dry in recent times.  Rains are now falling that could be very beneficial.  Vietnam has harvested its production under mostly dry conditions.  Central America is also drier for harvesting.  Good growing conditions are reported in Colombia and Peru.  The demand from coffee shops and other food service operations is still at very low levels.  Reports indicate that consumers at home are consuming blends with more Robusta and less Arabica.

Overnight News:  ICE certified stocks are lower today at 1.736 million bags.  The ICO daily average price is now 119.33 ct/lb.  Brazil will get scattered showers with near normal temperatures.  Central America will get scattered showers or dry conditions.  Vietnam will see mostly dry conditions.  ICE said that 12 notices were posted for delivery against March contracts and that total deliveries for the month are now 118 contracts.

Chart Trends:  Trends in New York are mixed to up with objectives of 134.00 and 141.00 May.  Support is at 126.00, 124.00, and 121.00 May, and resistance is at 131.00, 134.00 and 137.00 May.  Trends in London are mixed to up with objectives of 1400 and 1430 May.   Support is at 1370, 1350, and 1320 May, and resistance is at 1400, 1420, and 1430 May.

 

SUGAR                 

General Comments:  New York and London closed higher and both markets made new highs for the move and new contract highs.  Ideas of increased demand are still around as traditional buyers have been active.  Rains were reported again in Brazil.  It has been raining in south central Brazil and the production of cane is over for the season.  Production has been hurt due to dry weather earlier in the year.  India is producing less Sugar and more Ethanol.  Thailand might have less this year due to reduced planted area and erratic rains during the monsoon season.  The EU Sugar crop is less this year as is the crop in Russia.

Overnight News:  Brazil will get scattered showers.  Temperatures should average near normal.

Chart Trends: Trends in New York are up with objectives of 1770 and 1830 May.  Support is at 1610, 1580, and 1560 May, and resistance is at 1660, 1690, and 1720 May.  Trends in London are up with objectives of 480.00 May.  Support is at 461.00, 458.00, and 451.00 May, and resistance is at 476.00, 482.00, and 48.00 May.

 

DJ USDA FORUM: U.S. Sugar Supply And Use – Feb 19 

ARLINGTON, Va. (Dow Jones)–Data from 2021 USDA Agricultural Outlook Forum,

February 19, 2021.

2019/20           2020/21           2021/22

Jan         Feb    Projections

1,000 short tons, raw value

Beginning Stocks        1,783      1,618       1,618        1,993

Production 2/           8,149      9,156       9,312        9,399

Beet Sugar              4,351      4,992       5,046        5,154

Cane Sugar              3,798      4,163       4,265        4,245

Florida                 2,106      2,135       2,200        2,150

Hawaii                      –          –           –            –

Louisiana               1,566      1,886       1,931        1,945

Texas                     126        142         134          150

Imports                 4,235      3,344       3,404        2,728

TRQ 3/                  2,152      1,721       1,721        1,597

Other Program 4/          432        350         350          350

Other 5/                1,651      1,273       1,333          781

Mexico                  1,376      1,163       1,163          735

Total Supply           14,166     14,117      14,333       14,119

Exports                    61         35          35           35

Deliveries             12,414     12,305      12,305       12,405

Food                   12,316     12,200      12,200       12,300

Other  6/                  98        105         105          105

Miscellaneous              74          –           –

Total Use              12,549     12,340      12,340       12,440

Ending Stocks           1,618      1,777       1,993        1,679

Stocks to Use Ratio      12.9       14.4        16.1         13.5

1/ Fiscal years beginning Oct 1. Historical data are from USDA’s “Sweetener Market

Data” report. 2/ Production projections for 2020/21 and 2021/22 are based on Crop

Production and/or processor projections/industry data and/or sugar ICEC analysis

where appropriate. 3/ For 2020/21, WTO raw sugar TRQ shortfall (99) and for 2021/22

(99). 4/ Composed of sugar under the re-export and polyhydric alcohol programs. 5/

Imports from Mexico; and high-tier tariff sugar and syrups not otherwise specified —

for 2019/20 (275), 2020/21 (170), and 2021/22(46). 6/ Transfers to sugar-containing

products for re-export and for livestock feed and nonedible alcohol/ethanol.

 

COCOA                

General Comments:  New York and London closed lower on ideas of big supplies available to the market.  The ICCO said that the Cocoa surplus would be about 100,000 tons this year.  Chart trends are turning down.  There were reports of demand for Cocoa in Ivory Coast, although the reports noted that there is a lot to sell there.  The grind data has been weaker again implying less demand for chocolate.  Ivory Coast has not been shipping as exporters have asked to hold off.  There are ideas of big supplies at origin.  Wire reports this morning say that Ivory Coast has abandoned its tax scheme and instead is offering a discount to get Cocoa moving again.

Overnight News:  Mostly dry conditions are forecast for West Africa.  Temperatures will be near to 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 lower today at 3.540 million bags.  ICE said that 61 contracts were delivered against March futures and that total deliveries for the month are now 62 contracts.

Chart Trends:  Trends in New York are mixed to down with objectives at 2240 and 2060 May.  Support is at 2370, 2250, and 2200 May, with resistance at 2430, 2460, and 2480 May.  Trends in London are mixed to down with objectives of 1580 and 1520 May.  Support is at 1620, 1610, and 1580 May, with resistance at 1640, 1660, and 1680 May.

 

Ivory Coast Raises Cocoa Main-Crop Forecast to 1.65 Million Tons
2021-02-18 13:50:09.930 GMT

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