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 sharply higher in all months yesterday despite a stronger US Dollar that continued to hurt overall price action and as speculators worried that inflation and central bank actions to counter inflation could hurt demand. Futures had an inside day yesterday even with the big rally. The trade is also worried about Chinese demand due to the Covid lockdowns there. India will now try to increase imports as world and US Cotton is now lower cost to importers as import taxes have been removed, but prices for imported Cotton are still very high. Production of the next US crop is at risk now due to dry weather in general for the western Great Plains. There was talk about less demand for the market in part from Fed moves to control the inflation now seen in the US and around the world. Traders are getting worried about a potential recession caused by Fed tightening. China could be imports due to Covid and is also closing down a number of cities as the Covid spreads through the nation. China has been buying even with the port closures and domestic difficulties caused by renewed Covid lockdowns. Traders are worried about Chinese demand moving forward.
Overnight News: The Delta and Southeast will get isolated to scattered showers and above normal temperatures. Texas will have mostly dry conditions or isolated showers and near to above normal temperatures. The USDA average price is now 145.81 ct/lb. ICE said that certified stocks are now 1,101 bales, from 1,101 bales yesterday. ICE said that 0 notices were posted for delivery against May contracts and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in Cotton are up with objectives of 16180 July. Support is at 14400, 14070, and 13760 July, with resistance of 15110, 15200 and 15320 July.
General Comments: FCOJ was lower yesterday on inflation concerns. Inflation and central bank actions to counter inflation have many concerns about how consumers will be affected and what the buying power of consumers might be in the end. The market now knows it is short Oranges and short juice production but is also worried about domestic demand destruction as pills are becoming cheaper again. The greening disease has taken its toll on the US crop and the previous Brazil crop was down significantly due to drought. The weather remains generally good for production around the world for the next crop. Brazil has some rain and conditions are rated good, but it is drier now and some tree stress could develop soon. Weather conditions in Florida are rated mostly good for the crops with some showers and warm temperatures. The Florida Dept of Citrus said that FCOJ stocks are now 30.2% less than last year.
Overnight News: Florida should get isolated showers. Temperatures will average near to above normal. Brazil should get isolated showers and near normal temperatures. ICE said that 0 notices were posted for delivery against May futures and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 174.00, 169.00, and 164.00 July, with resistance at 187.00, 189.00, and 195.00 July.
General Comments: New York was sharply lower and London was closed to start the week. A stronger US Dollar and concerns about inflation continue and what the central banks might do to counter inflationary tendencies are important and what the banks could do is causing a lot of fear among traders. Arabica offers remain down as the Brazilian Real remains very strong, but there are still some Robusta offers hitting London. Ideas are that demand could get hurt as inflation and central bank actions hurt buying power from consumers. Deliveries from Vietnam and Brazil Robusta are noted to be decreasing as the harvest is now complete. Indonesian offers are increasing due to plentiful stocks inside the country. Arabica deliveries from Brazil are less in part due to less production and in part due to a stronger Real that has cut prices paid to farmers inside the country. Less deliveries are reported from Vietnam now as producers have sold most of the crop and are holding the rest and waiting for higher prices. Good growing conditions for the next crop in Brazil are still around but flowering is reported to be uneven this year in at least some areas.
Overnight News: ICE certified stocks are unchanged today at 1.118 million bags. The ICO daily average price is now 192.57 ct/lb. Brazil will get mostly dry conditions with above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE NY said that 0 delivery notices were tendered against May contracts and that total deliveries for the month are now 376 contracts.
Chart Trends: Trends in New York are mixed. Support is at 215.00, 213.00, and 210.00 July, and resistance is at 218.00, 225.00 and 230.00 July. Trends in London are mixed. Support is at 2060, 2010, and 1990 July, and resistance is at 2130, 2140, and 2150 July.
General Comments: New York closed lower and London was closed yesterday. Speculators were worried about inflation and what actions the central banks could take to combat it. Ideas are that consumer demand could be hurt, but the market was considered oversold and demand appeared. The US Dollar was strong and has been strong to drive up the price in local currencies of the importers and exporters, but the sell side knows futures have fallen and are holding. Increased offers from India and Thailand are expected if the market continues to rally. Pakistan is also increasing its offers due to good crops there. The US government is permitting refiners to blend 15% ethanol into the fuel mixtures instead of 10% for the coming Summer, but most of the Ethanol will come from Corn. India and Thailand expect improved crops this year. Thailand expects to produce about10 million tons of sugar this year, up 33% from last year. India said it could produce more than 9.0 million tons of Sugar. Brazil could also have better Sugarcane production this year but the strengthening Real implies that most of the refining will be for Ethanol and not Sugar.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average above normal. India will get isolated showers in eastern areas and near to above normal temperatures.
Chart Trends: Trends in New York are mixed. Support is at 1870, 1850, and 1810 July and resistance is at 1910, 1940, and 1950 July. Trends in London are mixed to up with objectives of 540.00 and 551.00 August. Support is at 518.00, 515.00, and 508.00 August and resistance is at 542.00, 548.00, and 554.00 August.
General Comments: New York was higher and London was closed yesterday. The trends are up on the daily charts. The weather is good for harvest activities in West Africa, but some are concerned about dry weather that could affect the yields for the midcrop harvest. Some showers are in the forecast for West Africa and have been for several weeks, but the precipitation was less than normal last week and net drying is reported. The weather is good in Southeast Asia. Ghana arrivals have been below year ago levels, but Ivory Coast arrivals are ahead of last year.
Overnight News: Scattered showers are forecast for West Africa. Temperatures will be near to above normal. Malaysia and Indonesia should see scattered showers. Temperatures should average above normal. Brazil will get mostly dry conditions and near to above normal temperatures. ICE certified stocks are slightly higher today at 5.026 million bags. ICE said that 6 notices were posted for delivery against May contracts and that total deliveries for the month are now 225 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 2600 and 2650 July. Support is at 2550, 2520, and 2500 July, with resistance at 2620, 2640, and 2680 July. Trends in London are up with objectives of 1860 and 1920 July. Support is at 1800, 1760, and 1740 July, with resistance at 1840, 1870, and 1900 July.