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: Futures were a little lower yesterday as some speculative selling entered the market before Thanksgiving. Demand has fallen off with the rally in the US Dollar but US prices are reported to be still well below those in China so strong demand is expected to continue, at least from that destination. Demand from Europe could start to suffer as countries there are starting to lock down again to prevent the spread of Covid. Trends are sideways on the charts but are starting to turn up again and the fundamentals have not really changed. Demand for US Cotton remains very strong and that is good news for sellers as the strong demand implies strong prices should continue. Analysts say the Asian demand is still very strong and likely hold at high levels for the future. US consumer demand has been very strong as well despite higher prices and inflation. Good US production is expected. The harvest is behind the 5 year average due to rains in the Delta and Southeast that have kept farmers from the fields. Chinese demand is also strong as clothes makers use foreign Cotton to get away from domestic supplies that might have been produced by forced labor and might not be allowed in the US or other western countries
Overnight News: The Delta and Southeast will get mostly dry conditions and below normal temperatures. Texas will have mostly dry conditions and above normal temperatures. The USDA average price is now 113.02 ct/lb. ICE said that certified stocks are now 400 bales, from 400 bales yesterday. ICE said that 2 notices were posted for delivery against December contracts and that total deliveries for the month are now 2 contracts.
Chart Trends: Trends in Cotton are mixed. Support is at 11460, 11360, and 11200 March, with resistance of 11850, 11920 and 11980 March.
General Comments: FCOJ was mixed and trends remain sideways in the market. There is not much going on in this market but the charts show that futures might have made a short term low last week. The hurricane season is over and the chances for a damaging storm to hit the state of Florida are gone so speculators have gotten out of longs and got short. The weather remains generally good for production around the world. Brazil has some rain with more in the forecast and flowering is likely. Brazil production was down last year due to dry conditions at flowering time and then a freeze just before harvest. Weather conditions in Florida are rated mostly good for the crops with a couple of showers and near normal temperatures. Mexican crop conditions in central and southern areas are called good with rains. Northern and western Mexico is rated in good condition.
Overnight News: Florida should get mostly dry conditions. Temperatures will average near to below normal. Brazil should get scattered to isolated showers and above normal temperatures.
Chart Trends: Trends in FCOJ are up with objectives of 129.00 and 134.00 January. Support is at 125.00, 124.00, and 119.00 January, with resistance at 132.00, 135.00, and 137.00 January.
General Comments: New York and London closed sharply higher yesterday with the logistical problems in Brazil very important to the trade. The trucks have gone on strike in Brazil, compounding logistical problems for exports from that country. Certified inventories in New York were sharply lower this week. The lack of Coffee available to deliver against Robusta contracts remains a factor. Containers are not available in Vietnam to ship the Coffee. Covid has also returned to Vietnam and could be a factor in interrupting shipments. Brazil also has limited amounts of Coffee available after bad weather at flowering time and then a freeze before the harvest got underway. Production conditions for the next crop in Brazil are called good. Scattered showers are now in the forecast for Southeast Asia and for Vietnam. The weather has been erratic and some harvest delays are being reported due to too much rain falling before. Bad conditions are reported in northern South America with above average rains and good conditions reported in Central America with near average rains. Conditions are reported to be generally good in parts of Africa.
Overnight News: ICE certified stocks are much lower today at 1.682 million bags. The ICO daily average price is now 206.9 ct/lb. Brazil will get mostly dry conditions with near to above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE NY said that 0 contracts were tendered against December futures and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in New York are up with objectives of 245.00 and 256.00 March. Support is at 234.00, 228.00, and 224.00 March, and resistance is at 242.00, 245.00 and 248.00 March. Trends in London are mixed to up with objectives of 2350 and 2460 January. Support is at 2250, 2190, and 2160 January, and resistance is at 2340, 2370, and 2400 January.
General Comments: New York and London closed higher. The daily charts show that futures are back in the recent trading range and the weekly charts also show a range trade. The charts show that futures continue to hold support and keep the longer term up trends alive. Ideas are that the supplies are out there but it will take a stronger price to get them into the market. Ideas are that Indian producers and exporters are willing sellers above 20.50 cents. Processors in Brazil are refining the cane for Ethanol more than Sugar right now and this trend is expected to continue due to the relative price spreads. The reduced production potential from Brazil for the current harvest is still impacting the market. Brazil now expects to produce 30.7 million tons of Sugar this year, down 10% from original projections. India is not offering as world prices are well below domestic prices and has had some weather problems of its own. It has just raised the price of Sugarcane juice for ethanol production so mills can divert more from the Sugar market into Ethanol production. Thailand is expecting improved production. It is raining in southern Brazil which will be good for the next crops there.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average near to above normal.
Chart Trends: Trends in New York are mixed. Support is at 1950, 1920, and 1910 March, and resistance is at 2020, 2040, and 2050 March. Trends in London are mixed. Support is at 506.00, 504.00, and 500.00 March, and resistance is at 521.00, 523.00, and 527.00 March.
General Comments: New York closed lower and London closed higher and trends are still mostly up in both markets. Ideas are that demand will only improve slightly and production in West Africa appears to be good this year. Both Ivory Coast and Ghana are reporting improved weather as it is now mostly sunny with some scattered showers around. World economies are starting to reopen after Covid and the open economies are giving demand the boost but the boost has not been as strong as hoped for earlier.
Overnight News: Isolated showers 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 5.117 million bags. ICE said that 659 notices were posted for delivery against December contracts and that total deliveries for the month are now 1,278 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 2680 March. Support is at 2540, 2520, and 2480 March, with resistance at 2600, 2630, and 2650 March. Trends in London are up with objective of 1760 and 1800 March. Support is at 1730, 1710, and 1680 March, with resistance at 1770, 1820, and 1830 March.