Softs Report 05/15/2023

COTTON
General Comments: Cotton was lower last week, but rebounded on Friday on the back of the latest USDA production and WASDE reports. USDA said final production for the current year was 14.68 million bales. It estimated current year ending stocks at 3.5 million bales. USDA estimate production next year at 15.5 million bales and total supply at just over 19 million bales. Total use was estimated at 15.7 million bales so ending stocks are estimated to be 3.3 million bales at the end of the next crop year. USDA showed the potential for a tight supply and demand situation looking forward. Traders were adjusting positions before the WASDE report today. 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 showers and near to below normal temperatures. The USDA average price is now 77.28 ct/lb. ICE daily certified stocks are now 75 bales, from 75 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 79.50, 78.60, and 78.10 July, with resistance of 81.80, 83.10 and 84.10 July.

DJ USDA Crop Production: Final U.S. All Cotton – 2
Cotton: Production and Bales Ginned by Type,
State, and United States, 2021-22
============================================================================
Production in Lint- Bales Ginned in
Type 480-lb Net Weight seed 480-lb Net Weight
and Bales 1/ Ratio Bales 2/
State ================================================================
2021 2022 2021 2022 2021 2022
============================================================================
—- 1,000 Bales — ——– Bales ——–
Upland
U.S. 17,191.0 13,998.0 (NA) (NA) 17,157,450 13,972,400
American-Pima
U.S. 332.0 470.0 (NA) (NA) 330,150 468,400
All
U.S. 17,523.0 14,468.0 (NA) (NA) 17,487,600 14,440,800
============================================================================
(NA) Not available.
1/ Production ginned and to be ginned.
2/ Equivalent 480-pound net weight bales ginned, not adjusted for
cross-state movement.
Cottonseed: Production and Farm Disposition
by State and United States, 2021-22
==========================================================================
Farm Disposition
———————————– Seed for
Production Sales to Planting 2/
Oil Mills Other 1/
State ==============================================================
2021 2022 2021 2022 2021 2022 2021 2022
==========================================================================
1,000 Tons
U.S. 5,323.0 4,415.0 2,521.0 1,923.0 2,802.0 2,492.0 69.4 67.4
==========================================================================
– Represents zero.
1/ Includes planting seed, feed, exports, inter-farm sales, shrinkage,
losses, and other uses.
2/ Included in ‘other’ farm disposition. Seed for planting is produced in
crop year shown, but used in the following year.

World and U.S. Supply and Use for Cotton 1/
Million 480-lb. Bales
================================================================================
Total Total Ending
Commodity Output Supply Trade 2/ Use 3/ Stocks
================================================================================

World
2021/22 115.78 202.00 43.00 115.90 86.16
2022/23 (Est.) 116.36 202.51 38.27 109.63 92.63
2023/24 (Proj.)
Apr NA NA NA NA NA
May 115.69 208.32 42.85 116.23 92.28
United States
2021/22 17.52 20.68 14.62 2.55 3.75
2022/23 (Est.) 14.47 18.22 12.60 2.10 3.50
2023/24 (Proj.)
Apr NA NA NA NA NA
May 15.50 19.01 13.50 2.20 3.30
Foreign 4/
2021/22 98.26 181.32 28.38 113.35 82.41
2022/23 (Est.) 101.89 184.29 25.67 107.53 89.13
2023/24 (Proj.)
Apr NA NA NA NA NA
May 100.19 189.32 29.35 114.03 88.98
================================================================================
WASDE – 636 – 10 May 2023

U.S. Cotton Supply and Use 1/
================================================================================
2021/22 2022/23 Est. 2023/24 Proj. 2023/24 Proj.
Item Apr May
================================================================================
Million Acres
Planted 11.22 13.76 NA 11.26*
Harvested 10.27 7.31 NA 8
Pounds
Yield per Harvested
Acre 819 950 NA 854*
Million 480 Pound Bales
Beginning Stocks 3.15 3.75 NA 3.50
Production 17.52 14.47 NA 15.50
Imports 0.01 0.01 NA 0.01
Supply, Total 20.68 18.22 NA 19.01
Domestic Use 2.55 2.10 NA 2.20
Exports, Total 14.62 12.60 NA 13.50
Use, Total 17.17 14.70 NA 15.70
Unaccounted 2/ -0.24 0.02 NA 0.01
Ending Stocks 3.75 3.50 NA 3.30
Avg. Farm Price 3/ 91.4 82.0 NA 78.0
================================================================================
WASDE – 636 – 18 May 2023

COT — Supplemental Report – Option and Futures Combined Positions as of May 09, 2023
: Reportable Positions : Nonreportable
:—————————————————————————————- : Positions
: Non-Commercial : Commercial : Index Traders : Total
: Long : Short :Spreading: Long : Short : Long : Short : Long : Short : Long : Short
——————————————————————————————————————-
COTTON NO. 2 – ICE FUTURES U.S.
CFTC Code #033661 Open Interest is 220,342
: Positions :
: 28,141 43,823 53,546 55,620 96,198 70,564 14,837 207,871 208,403: 12,471 11,939
: :
: Changes from: May 2, 2023 (Change in open interest: 5,813) :
: 799 -6,908 2,827 1,016 10,060 1,710 88 6,352 6,066: -539 -253
: :
: Percent of Open Interest Represented by Each Category of Trader :
: 12.8 19.9 24.3 25.2 43.7 32.0 6.7 94.3 94.6: 5.7 5.4
: :
: Total Traders: 272 Number of Traders in Each Category :
: 80 74 95 51 56 48 24 220 211:
——————————————————————————————————————-

FCOJ
General Comments: FCOJ closed lower last week and featured selling in response to the USDQ production estimates released on Friday. USDA estimated production down at 15.7 million boxes for Florida. The market response implies that the lower production is already factored into the price. 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. Florida Citrus Mutual said that FCOJ inventories are 33% less than last year.
Overnight News: Florida should get isolated showers. Temperatures will average near normal. Brazil should get mostly dry conditions and near to above normal temperatures. ICE said that 0 notices were posted for delivery against May contracts and that total deliveries for the month are now 30 contracts.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 240.00 and 220.00 July. Support is at 237.00, 229.00, and 227.00 July, with resistance at 250.00, 255.00, and 260.00 July.

The United States all orange forecast for the 2022-2023 season is
2.55 million tons, down 1 percent from the previous forecast and
down 25 percent from the 2021- 2022 final utilization. The Florida all orange
forecast, at 15.7 million boxes (705,000 tons), is down 3 percent from the
previous forecast and down 62 percent from last season’s final utilization.
In Florida, early, midseason, and Navel varieties are forecast at
6.15 million boxes (277,000 tons), up 1 percent from the previous forecast
but down 66 percent from last season’s final utilization. The Florida
Valencia orange forecast, at 9.50 million boxes (428,000 tons), is
down 5 percent from the previous forecast and down 59 percent from last
season’s final utilization.

Disaggregated Commitments of Traders- Options and Futures Combined Positions as of May 9, 2023
: Reportable Positions :
:————————————————————————————————————- :
: Producer/Merchant : : : :
: Processor/User : Swap Dealers : Managed Money : Other Reportables :
: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading :
—————————————————————————————————————-
FRZN CONCENTRATED ORANGE JUICE – ICE FUTURES U.S. (CONTRACTS OF 15,000 POUNDS) :
CFTC Code #040701 Open Interest is 10,711 :
: Positions :
: 998 5,625 1,264 121 50 3,957 495 3 819 671 1,824 :
: :
: Changes from: May 2, 2023 :
: 434 -593 0 -36 10 -473 19 -13 -49 201 -210 :
: :
: Percent of Open Interest Represented by Each Category of Trader :
: 9.3 52.5 11.8 1.1 0.5 36.9 4.6 0.0 7.6 6.3 17.0 :
: :
: Number of Traders in Each Category Total Traders: 59 :
: 9 9 4 . . 19 . . 6 13 7 :
—————————————————————————————————————-

COFFEE
General Comments: New York was a little lower, and London was higher in range trading on Friday, but both markets closed a little lower for the week. 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. Brazil said that April exports were 14% less than a year ago at 2.7 million bags. Exports of both Arabica and Robusta beans were less than a year ago, but exports of roasted, ground, and soluble coffee were higher than a year ago.
Overnight News: ICE certified stocks are lower today at 0.644 million bags. The ICO daily average price is now 173.40 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 615 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 to down with objectives of 2340 and 2220 July. Support is at 2380, 2320, and 2270 July, and resistance is at 2460, 2500, and 2530 July.

COT — Supplemental Report – Option and Futures Combined Positions as of May 09, 2023
: Reportable Positions : Nonreportable
:—————————————————————————————- : Positions
: Non-Commercial : Commercial : Index Traders : Total
: Long : Short :Spreading: Long : Short : Long : Short : Long : Short : Long : Short
——————————————————————————————————————-
COFFEE C – ICE FUTURES U.S.
CFTC Code #083731 Open Interest is 229,802
: Positions :
: 32,318 20,414 64,495 53,751 126,598 71,339 11,370 221,903 222,877: 7,900 6,926
: :
: Changes from: May 2, 2023 (Change in open interest: -2,412) :
: -5,440 -143 -2,432 3,791 1,914 1,805 -1,512 -2,276 -2,172: -136 -239
: :
: Percent of Open Interest Represented by Each Category of Trader :
: 14.1 8.9 28.1 23.4 55.1 31.0 4.9 96.6 97.0: 3.4 3.0
: :
: Total Traders: 359 Number of Traders in Each Category :
: 88 79 113 106 120 50 23 308 282:
——————————————————————————————————————-

DJ ICE Commitments: ICE Europe Robusta Coffee Futures/Options
Commitments of Traders-Options and Futures
Combined Positions as of 05/09/2023
Reportable Positions
===============================================================================
Producer/Merchant/ Swap Dealers
Processor/User
OI Long Short Long Short Spreading
===============================================================================
ICE Futures Europe
130,930 46,439 93,638 3,807 6,322 2,528
Percent of Open Interest Represented by each Category of Trader
100% 35.5% 71.5% 2.9% 4.8% 1.9%
Number of Traders in Each Category
161 43 42 6 9 10
Reportable Positions
===============================================================================
Managed Money Other Reportables
Long Short Spreading Long Short Spreading
===============================================================================
45,273 4,464 7,889 7,283 2,100 9,644
Percent of Open Interest Represented by Each Category of Trader
34.6% 3.4% 6.0% 5.6% 1.6% 7.4%
Number of Traders in Each Category
57 6 15 20 9 18
Nonreportable Positions
=======================
Long Short
=======================
8,067 4,345
Percent of Open Interest Represented by Each Category of Trader
6.2% 3.3%

SUGAR
General Comments: Both New York and London closed slightly lower last week, and trends remain sideways in both markets. The market was hurt by good growing conditions in Brazil 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 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. Brazil said that center-south Sugarcane processing was 21 million tons this year, down 13% from last year as fields to be harvested got too much rain. Sugar production was 988,970 tons, up 5.9% from last year, and ethanol production was 978 million liters, down 11% from last year.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average near to above normal. India will get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in New York are mixed. 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.

U.S. Sugar Supply and Use 1/
================================================================================
2021/22 2022/23 Est. 2022/23 Est. 2023/24 Proj.
Item Apr May May
================================================================================
1000 Short Tons, Raw Value
Beginning Stocks 1705 1820 1820 1734
Production 2/ 9157 9306 9283 9225
Beet Sugar 5155 5150 5155 4961
Cane Sugar 4002 4156 4127 4264
Florida 1934 2044 2015 2065
Louisiana 1944 2034 2034 2092
Texas 124 78 78 107
Imports 3646 3511 3446 3300
TRQ 3/ 1579 1730 1730 1413
Other Program 4/ 298 250 250 250
Non-program 1769 1531 1466 1637
Mexico 1379 1306 1241 1517
High-tier tariff/other 390 225 225 120
Total Supply 14508 14637 14549 14259
Exports 29 35 35 35
Deliveries 12578 12705 12780 12780
Food 12470 12600 12675 12675
Other 5/ 107 105 105 105
Miscellaneous 81 0 0 0
Total Use 12688 12740 12815 12815
Ending Stocks 1820 1897 1734 1444
Stocks to Use Ratio 14.3 14.9 13.5 11.3
================================================================================

Mexico Sugar Supply and Use and High Fructose Corn Syrup Consumption 1/
================================================================================
Supply Use
Fiscal Beginning Produc- Imports Domestic Exports Ending
Year Stocks tion 2/ Stocks
================================================================================

1000 Metric Tons, Actual Weight

Sugar
2022/23 Est.
Apr 964 5560 35 4499 1123 937
May 964 5385 45 4435 1070 889
2023/24 Proj.
Apr NA NA NA NA NA NA
May 889 5900 45 4639 1298 897
================================================================================
WASDE – 636 – 17 May 2023

COT — Supplemental Report – Option and Futures Combined Positions as of May 09, 2023
: Reportable Positions : Nonreportable
:—————————————————————————————- : Positions
: Non-Commercial : Commercial : Index Traders : Total
: Long : Short :Spreading: Long : Short : Long : Short : Long : Short : Long : Short
——————————————————————————————————————-
SUGAR NO. 11 – ICE FUTURES U.S.
CFTC Code #080732 Open Interest is 1,266,634
: Positions :
: 220,523 55,886 330,445 377,964 734,957 238,535 99,831 1,167,467 1,221,119: 99,168 45,515
: :
: Changes from: May 2, 2023 (Change in open interest: 40,608) :
: 5,349 -4,228 24,743 15,563 21,439 -4,596 -1,059 41,060 40,896: -452 -287
: :
: Percent of Open Interest Represented by Each Category of Trader :
: 17.4 4.4 26.1 29.8 58.0 18.8 7.9 92.2 96.4: 7.8 3.6
: :
: Total Traders: 257 Number of Traders in Each Category :
: 91 36 81 68 75 42 23 235 184:
——————————————————————————————————————-

DJ ICE Commitments: ICE Europe White Sugar Futures/Options
Commitments of Traders-Options and Futures
Combined Positions as of 05/09/2023
Reportable Positions
===============================================================================
Producer/Merchant/ Swap Dealers
Processor/User
OI Long Short Long Short Spreading
===============================================================================
ICE Futures Europe
79,776 32,049 59,982 6,899 3,667 1,319
Percent of Open Interest Represented by each Category of Trader
100% 40.2% 75.2% 8.6% 4.6% 1.7%
Number of Traders in Each Category
125 39 44 10 2 7
Reportable Positions
===============================================================================
Managed Money Other Reportables
Long Short Spreading Long Short Spreading
===============================================================================
26,154 3,478 3,664 967 1,557 3,468
Percent of Open Interest Represented by Each Category of Trader
32.8% 4.4% 4.6% 1.2% 2.0% 4.3%
Number of Traders in Each Category
39 9 19 8 4 10
Nonreportable Positions
=======================
Long Short
=======================
5,256 2,641
Percent of Open Interest Represented by Each Category of Trader
6.6% 3.3%

COCOA
General Comments: New York and London closed higher again last week 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, but certified stocks have increased a lot this week in New York and deliveries have picked up as well. 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
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 5.664 million bags. ICE NY said that 9 notices were posted for delivery against May futures and that total deliveries for the month are now 1,265 contracts.
Chart Trends: Trends in New York are up with objectives of 3080 July. Support is at 2950, 2920, and 2900 July, with resistance at 3050, 3070, and 3100 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 2300, 2320, and 2380 July.

COT — Supplemental Report – Option and Futures Combined Positions as of May 09, 2023
: Reportable Positions : Nonreportable
:—————————————————————————————- : Positions
: Non-Commercial : Commercial : Index Traders : Total
: Long : Short :Spreading: Long : Short : Long : Short : Long : Short : Long : Short
——————————————————————————————————————-
COCOA – ICE FUTURES U.S.
CFTC Code #073732 Open Interest is 415,733
: Positions :
: 100,771 61,035 127,999 110,503 180,929 61,683 35,534 400,957 405,497: 14,777 10,236
: :
: Changes from: May 2, 2023 (Change in open interest: 15,876) :
: 1,425 -1,532 10,914 3,266 8,091 903 -756 16,508 16,717: -632 -841
: :
: Percent of Open Interest Represented by Each Category of Trader :
: 24.2 14.7 30.8 26.6 43.5 14.8 8.5 96.4 97.5: 3.6 2.5
: :
: Total Traders: 263 Number of Traders in Each Category :
: 101 62 93 42 45 31 15 229 173:
——————————————————————————————————————-

DJ ICE Commitments: ICE Europe Cocoa Futures/Options
Commitments of Traders-Options and Futures
Combined Positions as of 05/09/2023
Reportable Positions
===============================================================================
Producer/Merchant/ Swap Dealers
Processor/User
OI Long Short Long Short Spreading
===============================================================================
ICE Futures Europe
389,368 146,879 256,227 29,729 28,359 29,473
Percent of Open Interest Represented by each Category of Trader
100% 37.7% 65.8% 7.6% 7.3% 7.6%
Number of Traders in Each Category
168 48 45 17 7 10
Reportable Positions
===============================================================================
Managed Money Other Reportables
Long Short Spreading Long Short Spreading
===============================================================================
100,318 5,109 21,367 15,098 5,026 41,246
Percent of Open Interest Represented by Each Category of Trader
25.8% 1.3% 5.5% 3.9% 1.3% 10.6%
Number of Traders in Each Category
47 10 20 19 8 24
Nonreportable Positions
=======================
Long Short
=======================
5,258 2,561
Percent of Open Interest Represented by Each Category of Trader
1.4% 0.7%

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