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
Softs Report 03/30/2023
General Comments: Cotton was mixed yesterday. Ideas are that the world economic problems were fading into the background as the US stock market has rallied. Chart trends turned mixed. The weekly export sales report showed good demand, and demand ideas are improving. Demand has been ramping up for the last couple of months but fell off. Some ideas that demand could soon increase more as China has opened its economy. China has also started buying again from Australia after refusing imports from that country for political reasons.
Overnight News: The Delta will get mostly dry conditions and near to below normal temperatures. The Southeast will see scattered showers and near to below normal temperatures. Texas will have mostly dry conditions and below normal temperatures. The USDA average price is now 80.44 ct/lb. ICE said that certified stocks are now 1,485 bales, from 1,485 bales yesterday. USDA said that weekly net Upland Cotton export sales were 281,300 bales this year and 12,300 bales next year. Net Pima sales were 10,100 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are up with objectives of 8360, 8770, and 9910 May. Support is at 81.20, 80.30, and 79.80 May, with resistance of 83.70, 84.60 and 85.20 May.
General Comments: FCOJ was sharply higher to limit up yesterday. Trends remain up in the market. Futures remain supported by very short Orange production estimates for Florida. Demand is thought to be backing away from FCOJ with prices as high as they are currently. Historically low estimates of production due in part to the hurricanes and in part to the greening disease that have hurt production, but conditions are significantly better now with scattered showers and moderate temperatures. The weather remains generally good for production around the world for the next crop including production areas in Florida that have been impacted in a big way by the two storms seen previously in the state. Brazil has some rain and conditions are rated good. Brazil continues to export to the EU and is increasing its exports to the US. Mexico is also exporting to the US. The Florida Dept of Citrus said that FCOJ inventories are down 38% from last year.
Overnight News: Florida should get isolated showers. Temperatures will average near to above normal. Brazil should get scattered showers and near normal temperatures.
Chart Trends: Trends in FCOJ are up with objectives of 264.00 May. Support is at 254.00, 250.00, and 245.00 May, with resistance at 263.00, 269.00, and 275.00 May.
General Comments: New York closed lower again yesterday, and London closed mixed to lower in consolidation trading. Trends turned down in New York with the price action yesterday. The lack of offers from South America and Vietnam is still supporting prices and reports indicate that demand for Robusta from Vietnam is strong and increasing due to cost differentials with Arabica. Differentials are now weakening in Brazil, Honduras, and Colombia, but reports indicate that differentials might start to firm up again as production ideas are low for Colombia and Brazil. The weather in Brazil is currently very good for production potential but worse conditions seen earlier in the growing cycle hurt the overall production prospects as did bad weather last year. Vietnam is getting less rain now to aid harvest progress but volumes offered have not increased.
Overnight News: ICE certified stocks are lower today at 0.745 million bags. The ICO daily average price is now 169.80 ct/lb. Brazil will get isolated showers in southern areas with above normal temperatures. Central America will get mostly dry conditions. Vietnam will see isolated showers.
Chart Trends: Trends in New York are down with objectives of 165.00, 164.00, and 161.00 May. Support is at 167.00, 165.00, and 163.00 May, and resistance is at 173.00, 176.00 and 180.00 May. Trends in London are mixed. Support is at 2140, 2090, and 2050 May, and resistance is at 2250, 2270, and 2300 May.
General Comments: New York was mixed, with nearby months a little lower but deferred months a little higher, and London closed higher again, and the trends are up in New York and in London on the daily charts. Supplies are tight. Indian production is thought to be less than 33 million tons this year as mills are closing early there and Thailand mills are also closing earlier than expected so the crop there might be less. Brazil production is solid this year. Reports from private analysts suggest that Brazil can have a 13% increase in center-south production. Brazil producers are currently active in the futures market placing hedges on the production. European production is expected to be reduced again this year. Some analysts now say that Chinese production could be the lowest in six years due to bad growing conditions.
Overnight News: Brazil will get isolated showers in southern areas. Temperatures should average above normal. India will get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in New York are mixed to up with objectives of 2160, 2170, and 2210 May. Support is at 2100, 2070, and 2040 May and resistance is at 2140, 2160, and 2190 May. Trends in London are up with objectives of 627.00 May. Support is at 608.00, 600.00, and 594.00 May and resistance is at 621.00, 624.00, and 627.00 May.
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General Comments: New York and London closed lower yesterday in consolidation trading. Wire reports suggest that producer selling increased on the recent rally in these markets. Trends remain up for at least the short term. Talk is that hot and dry conditions reported in Ivory Coast could curtail main crop production, and main crop production ideas are not strong. Mid crop production ideas are strong due to rains recently reported in Cocoa areas of the country. Ghana has reported a disease in its Cocoa to hurt production potential there, but overall production expectations are high. The rest of West Africa appears to be in good condition. The weather is good in Southeast Asia. Ivory Coast exports are now 1.7857 million tons down 1.5% from last year.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see scattered showers. Temperatures should average near normal. Brazil will get isolated showers and near to above normal temperatures. ICE certified stocks are lower today at 5.229 million bags.
Chart Trends: Trends in New York are mixed to up with objectives of 2960 May. Support is at 2850, 2820, and 2780 May, with resistance at 2920, 2960, and 2990 May. Trends in London are mixed. Support is at 2100, 2070, and 2030 May, with resistance at 2160, 2200, and 2230 May.