Softs Report 10/31/2023

MORNING SOFTS COMMENTS
Jack Scoville

Tuesday, October 31, 2023

Price Futures Group, CBOT
Chicago, IL
(312) 264-4322
jscoville@pricegroup.com

JSL, SA de CV
San Salvador, El Salvador (503) 2260-7806

COTTON
General Comments: Cotton closed lower yesterday in line with weakness in other major agricultural markets. Trends are mixed on the daily charts. Export sales for the current crop ear were about 185,000 bales and were much improved over the last few weeks. Macro economic data for the US was very strong as well. Ideas are that the US could be headed into a recession and cause demand to be soft. Prices are supported by ideas of tight supplies here in the US and around the world. There are still many concerns about demand from China and the rest of Asia due to the slow economic return of China in the world market. There are production concerns about Australian and Indian Cotton as both countries are likely to suffer the effects of El Nino starting this Fall.
Overnight News: The Delta will get isolated showers and below normal temperatures. The Southeast will see isolated showers and below normal temperatures. Texas will have scattered showers and below normal temperatures. The USDA average price is now 78.09 ct/lb. ICE daily certified stocks are now 76,292 bales, from 73,978 bales yesterday.
Chart Trends: Trends in Cotton are mixed to down with objectives of 82.10 and 81.70 December. Support is at 82.40, 81.50, and 80.80 December, with resistance of 85.40, 86.50 and 86.80 December.

Crop Progress
Date 29-Oct 22-Oct 2022 Avg
Cotton Bolls Opening 93 90 95 95
Cotton Harvested 49 41 54 47
Crop Condition
Very Poor Poor Fair Good Excellent
Cotton This Week 23 19 29 24 5
Cotton Last Week 24 19 28 24 5
Cotton Last Year 21 24 25 26 4

FCOJ
General Comments: FCOJ closed sharply higher to limit up yesterday on follow through buying, and the trends on the daily charts are up. Reports of short supplies in Florida and Brazil are around. Futures are also being supported in forecasts for an above average hurricane season that could bring a storm to damage the trees once again. 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.
Overnight News: Florida should get isolated showers. Temperatures will average near normal. Brazil should get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in FCOJ are up with no objectives. Support is at 403.00, 396.00, and 391.00 January, with resistance at 407.00, 410.00, and 413.00 January.

COFFEE
General Comments: New York and London closed lower yesterday on r3eports of improved rains in Brazil Coffee areas., Trends are down in both markets. Showers and rains are now being reported in central and southern growing areas of Brazil and conditions are called good. Demand for Robusta and lower quality Arabicas remains strong. The lack of offers from Asia, mostly from Vietnam but also Indonesia remains a main feature of the market, but the offers are starting to improve with the Vietnam harvest progressing and the US Dollar moving higher. Offers from Brazil and other countries in Latin America should be increasing but prices are considered a little cheap to create much selling interest from producers and the differentials offered have been very high. These are moderating as the new harvest comes to the market.
Overnight News: ICE certified stocks are lower today at 0.390 million bags. The ICO daily average price is now 151.53 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.
Chart Trends: Trends in New York are down with no objectives. Support is at 155.00, 153.00, and 151.00 December, and resistance is at 161.00, 165.00 and 170.00 December. Trends in London are down with no objectives. Support is at 2300, 2250, and 2220 January, with resistance at 2360, 2390, and 2430 January.

SUGAR
General Comments: New York and London closed lower yesterday and fell back after pushing for the highs on the weekly charts last week. A short term move lower could be developing. The market is still short of Sugar. There are still forecasts for and reports of rain in Brazil. The market continues to see stressful conditions in Asian production areas. The Brail rains is underway now and have been heavy in the south. There are worries about the Thai and Indian production potential due to El Nino. Offers from Brazil are still active but other origins are still not offering, and demand is still strong. Brazil ports are very congested so shipment of Sugar has been slower.
Overnight News: Brazil will get mostly dry conditions in the south and scattered showers in the north. 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. Support is at 2650, 2630, and 2620 March and resistance is at 2750, 2810, and 2840 March. Trends in London are down with no objectives. Support is at 714.00, 703.00, and 696.00 January, with resistance at 733.00, 738.00, and 747.00 January.

COCOA
General Comments: New York and London closed lower yesterday. The trends are still up in both markets. The EU grind data was stronger than expected and was down 0.9% from last year. The North American grind data was weaker by 17.9%. Cocoa arrivals at Ivory Coast ports dropped 16.2% for the marketing year when compared to last year. The main crop harvest comes into focus and as farmers in West Africa report that many areas have too much rain that has caused harvest delays and could lead to disease. Scattered to isolated showers are reported in the region now. Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast and Ghana continue, Midcrop production ideas are lower now with diseases reported in the trees due to too much rain that could also affect the main crop production.
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 4.654 million bags.
Chart Trends: Trends in New York are up with objectives of 3880, 3940, and 3990 December. Support is at 3780, 3700, and 3600 December, with resistance at 3880, 3920, and 3980 December. Trends in London are up with no objectives. Support is at 3330, 3260, and 3200 December, with resistance at 3440, 3470, and 3500 December.

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Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving offer or solicitation on our part with respect to the sale purchase of any securities or futures.
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