Softs Report 05/11/2023

COTTON
General Comments: Cotton was a little lower yesterday and the trends are mixed on the daily charts. Traders were adjusting positions before the export sales report this morning and the WASDE report tomorrow. Demand has been good, but the market is starting to shift attention to the new crop. Planting intentions showed only weak production ideas, but demand has been less until reviving lately. Forecasts for rain are still showing in forecasts for West Texas but the rains are expected to be lighter and more scattered than last week. The rains last week were spotty so more rain in new areas would be very beneficial. The rains will not solve drought problems but at least producers in the region can get started on fieldwork and hope for better yields this year. Ideas are that the world economic problems were fading into the background as the US stock market has held strong and as the Chinese economy gets better after all of the Covid lockdowns.
Overnight News: The Delta will get isolated to scattered showers and near to above normal temperatures. The Southeast will see isolated showers and near to above normal temperatures. Texas will have isolated to scattered showers and near to above normal temperatures. The USDA average price is now 77.51 ct/lb. ICE daily certified stocks are now 75 bales, from 75 bales yesterday. ICE said that 0 notices were posted for May delivery and that total deliveries for the month are now 0 contracts. USDA said that weekly net Upland Cotton export sales were 246,800 bales this year and 12,800 bales next year. Net Pima sales were 15,200 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 79.80, 78.60, and 78.10 July, with resistance of 83.10, 84.10 and 84.90 July.

FCOJ
General Comments: FCOJ closed mostly a little lower yesterday, but July closed slightly higher. Trends are down in this market despite very tight supplies as there has not been any news to keep bulls in the market lately. Futures remain supported by very short Oranges production estimates for Florida. Demand is thought to be backing away from FCOJ with prices as high as they are currently, but the market has not taken any note and continues to charge higher. 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.
Overnight News: Florida should get mostly dry conditions. Temperatures will average above normal. Brazil should get scattered showers and near normal temperatures.
Chart Trends: Trends in FCOJ are down with objectives of 240.00 and 220.00 July. Support is at 242.00, 237.00, and 229.00 July, with resistance at 255.00, 260.00, and 266.00 July.

DJ Florida FCOJ Movement and Pack – May 10
Florida FCOJ Movement And Pack
In mm ps, (million pounds solid). Source: Florida Department of Citrus (FDOC)
WEEK ENDING:
4/15/2023 Corresponding
Current Week Last
Week Season
4/15/2023 4/16/2022 % Change
CARRY OVER, RECEIPT & PACK
Carry Over
Bulk 130.54 193.35 -32.5%
Retail/Institutional 6.06 4.87 24.3%
Total 136.60 198.23 -31.1%
Pack
Bulk 1.89 2.31 -18.2%
Retail/Institutional 1.08 1.15 -6.7%
Total Pack 2.96 3.46 -14.4%
Reprocessed -2.54 -2.83 -10.3%
Pack from Fruit 0.42 0.63 -32.8%
Receipts & Losses
Net Gain or Loss -0.22 0.01 3797.9%
Imports – Foreign 1.99 4.59 -56.5%
Domestic Receipts 0.00 0.38 -100.0%
Receipts of Florida Product
from Non-Reporting Entit 0.15 0.00 NA
Chilled OJ used in FCOJ 0.00 0.86 -100.0%
Reprocessed FCTJ 0.12 0.15 -22.3%
Total Carry Over, Receipt & Pack
Bulk 131.93 198.81 -33.6%
Retail/Institutional 7.14 6.03 18.4%
Total 139.07 204.84 -32.1%
MOVEMENT
Bulk
Domestic 4.79 4.43 8.2%
Exports 0.09 0.36 -75.2%
Total (Bulk) 4.88 4.79 2.0%
Retail/Institutional
Domestic 1.00 1.15 -12.4%
Exports 0.00 0.00 NC
Total (Retail/Inst) 1.00 1.15 -12.4%
Total Movement 5.89 5.93 -0.8%
ENDING INVENTORY
Bulk 127.05 194.02 -34.5%
Retail/Institutional 6.13 4.88 25.6%
Ending Inventory 133.18 198.91 -33.0%
Total Same
Total Season Period Last
To Date Season
15-Apr-23 16-Apr-22 % Change
CARRY OVER, RECEIPT & PACK
Carry Over
Bulk 119.13 226.65 -47.4%
Retail/Institutional 6.60 6.08 8.6%
Total 125.74 232.73 -46.0%
Pack
Bulk 29.49 55.35 -46.7%
Retail/Institutional 30.42 32.98 -7.8%
Total Pack 59.90 88.33 -32.2%
Reprocessed -54.23 -69.41 -21.9%
Pack from Fruit 5.67 18.92 -70.0%
Receipts & Losses
Net Gain or Loss -0.56 -1.27 -55.9%
Imports – Foreign 130.50 106.12 23.0%
Domestic Receipts 4.77 3.44 38.5%
Receipts of Florida Produ
from Non-Reporting Entit 8.46 0.88 859.2%
Chilled OJ used in FCOJ 0.10 2.09 -95.3%
Reprocessed FCTJ 0.83 2.66 -68.8%
Total Carry Over, Receipt & Pack
Bulk 238.48 326.51 -27.0%
Retail/Institutional 37.02 39.07 -5.2%
Total 275.50 365.57 -24.6%
MOVEMENT
Bulk 110.30 120.71 -8.6%
Domestic 1.13 11.77 -90.4%
Exports 111.43 132.49 -15.9%
Total (Bulk)
Retail/Institutional
Domestic 30.89 34.18 -9.6%
Exports 0.00 0.00 NC
Total (Retail/Inst) 30.89 34.18 -9.6%
Total Movement 142.32 166.67 -14.6%
ENDING INVENTORY
Bulk 127.05 194.02 -34.5%
Retail/Institutional 6.13 4.88 25.6%
Ending Inventory 133.18 198.91 -33.0%

COFFEE
General Comments: New York was a little lower, and London was higher in range trading. There are reports of increased offers of Robusta from Brazil, and good weather is noted for Arabica production there, with high production expectations for Brazil. The Arabica harvest is now just a few weeks away and offers of Arabica from Brazil are expected to increase at that time. Charts trends are sideways on the daily charts. There are still tight Robusta supplies for the market amid strong demand for Robusta, but the Brazil harvest is in the market now. The Brazil harvest of Robusta is in full swing and promising to help relieve tight supplies in that market. The Arabica harvest should be active in the next few weeks. The Robusta market has been especially tight and has been pushing on the Arabica price, but Arabica supplies are growing tight in the market as well. Producers in Vietnam are said to have almost nothing left to sell and producers in Colombia and Brazil are also reported to be short Coffee to sell. The market really needs big offers from Brazil to sustain any down side movement.
Overnight News: ICE certified stocks are lower today at 0.649 million bags. The ICO daily average price is now 177.07 ct/lb. Brazil will get mostly dry conditions with near to above normal temperatures. Central America will get mostly dry conditions. Vietnam will see scattered showers. ICE NY said that 0 notices were posted for delivery against May futures and that total deliveries for the month are now 380 contracts.
Chart Trends: Trends in New York are mixed. Support is at 181.00, 180.00, and 177.00 July, and resistance is at 190.00, 196.00 and 198.00 July. Trends in London are mixed. Support is at 2450, 2380, and 2320 July, and resistance is at 2530, 2560, and 2590 July.

DJ Brazil Coffee Exports Fell 10% in April to 2.7M Bags, Cecafe Says
By Jeffrey T. Lewis
SÃO PAULO–Brazilian coffee exports fell in April as supplies in stock dwindled ahead of the arrival of the current crop, though sales abroad are likely to increase in coming months as the current harvest advances, according to exporters group Cecafe.
The South American country exported 2.7 million 132-pound bags of coffee last month, a decline of 10% from the same month a year earlier, Cecafe said Wednesday. Sales abroad of the arabica variety of coffee fell 14% to 2.3 million bags, while exports of robusta beans fell 14% to 123,356 bags.
Exports of ground, roast and soluble coffee rose 28% to 326,892 bags, Cecafe said.
There’s good demand among buyers for arabica coffee, and exports of the variety should increase in May and June with more supply becoming available as the current coffee crop is harvested, said Cecafe President Márcio Ferreira.
“For the new crop, we also see positive expectations, in view of the good conditions of the crops and the buying interest on the part of the importing countries,” he said.

SUGAR
General Comments: Both New York and London closed higher yesterday, and trends are trying to turn up in both markets again. The market was hurt by good growing conditions in Brazil for New York but supported by tight current supplies. Concern was noted about Chinese demand and the Brazil harvest is now just a few weeks away. Chinese demand has been a mystery as no one knows how much they will eventually buy. The production is not there to meet the demand in many countries, with only Brazil among the major producers looking to have a good crop. It should start becoming available soon. Indian production is thought to be less this year as mills are closing early there and Pakistan also has reduced production. Thailand mills are also closing earlier than expected so the crop there might be less. Asian countries could face another year of short production as El Nino returns after years of La Nina. European production is expected to be reduced again this year. Chinese production could be the lowest in six years due to bad growing conditions.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average near to below normal. India will get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in New York are mixed to up with objectives of 2690 July. Support is at 2590, 2560, and 2490 July and resistance is at 2680, 2720, and 2750 July. Trends in London are mixed. Support is at 700.00, 675.00, and 672.00 August and resistance is at 730.00, 733.00, and 736.00 August.

DJ Brazil Center-South Sugar Crush Down in 2H April on Bad Weather
By Jeffrey T. Lewis
SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed less cane in the second half of April compared with a year earlier, as rainy weather impeded harvesting in some areas, according to industry group Unica.
Center-south mills crushed 21 million metric tons of cane in the period, a decrease of 13% from the same period a year earlier, Unica said Thursday. The mills produced 988,970 tons of sugar, up 5.9%, and made 978 million liters of ethanol, down 11%.
Center-south mills lost about 10 days of harvesting during the full month of April due to the bad weather, Unica said.
The production mix for the second half of April was 44% sugar to 56% ethanol, compared with 37% sugar to 63% ethanol in the same period a year ago.
In the period from April 1 through April 30, mills in the region crushed 34.8 million tons of cane, up 19% from the same period a year earlier. Sugar production rose 44% to 1.5 million tons, and ethanol output climbed 17% to 1.8 billion liters.
The production mix for the season through April 30 was 42% sugar to 58% ethanol, compared with 35% sugar to 65% ethanol in the same period a year earlier.

COCOA
General Comments: New York and London closed higher again yesterday as ideas of tight supplies based on more reports of reduced arrivals in Ivory Coast continue. The lack of arrivals from West Africa to ports is still important and is supporting futures. Talk is that hot and dry conditions reported earlier in Ivory Coast could curtail main crop production, and main crop production ideas are not strong. Midcrop production ideas are strong due to rain mixed with some sun recently reported in Cocoa areas of the country. The rest of West Africa appears to be in good condition. The weather is good in Southeast Asia
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 higher today at 5.612 million bags. ICE NY said that 184 notices were posted for delivery against May futures and that total deliveries for the month are now 1,256 contracts.
Chart Trends: Trends in New York are up with objectives of 3080 July. Support is at 2990, 2900, and 2860 July, with resistance at 3010, 3040, and 3070 July. Trends in London are mixed to up with objectives of 2310 and 2380 July. Support is at 2220, 2200, and 2170 July, with resistance at 2250, 2290, and 2320 July.

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