Softs Report 12/05/2023

COTTON
General Comments: Cotton closed lower and trends are still mixed in this market. The export sales report was positive for prices once again last week. The US Dollar has been higher and economic data has been positive, but the Chinese economic data has not been real positive and demand has been down. 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 isolated showers and below normal temperatures. The USDA average price is now 74.29 ct/lb. ICE daily certified stocks are now 6,325 bales, from 58,324 bales yesterday. ICE said that 1 notice was posted for delivery against December contracts and that total deliveries for the month are now 815 contracts.
Chart Trends: Trends in Cotton are mixed. Support is at 77.70, 77.00, and 76.00 March, with resistance of 80.50, 81.20 and 82.00 March.

FCOJ
General Comments: FCOJ closed sharply lower to limit down, and the short term trends remain down in this market. There are no weather concerns to speak of for Florida right now with the hurricane season all but over and no major storms hitting the state recently. The weather has improved in Brazil with some moderation in temperatures and increased rainfall in the forecast for this week. Brazil got more than expected rains over the weekend. Reports of short supplies in Florida and Brazil are around. Historically low estimates of production in Florida 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 down with objectives of 381.00, 379.00, and 361.00 January. Support is at 382.00, 370.00, and 366.00 January, with resistance at 405.00, 408.00, and 418.00 January.

COFFEE
General Comments: Both markets closed yesterday on better than expected rains in Brazil over the weekend and forecasts for more this week. Brazil weather remains uneven for the best crop production and there are reports of increasing Coffee availability from Vietnam although not enough to meet all of the demand just yet. The forecasts some northern areas to get showers and rains and these areas should include some Coffee production regions that have dried recently. The lack of offers from Asia, mostly from Vietnam but also Indonesia have been a main feature of the market, but the offers are starting to improve. Offers from Brazil and other countries in Latin America should be increasing.
Overnight News: ICE certified stocks are unchanged today at 0.224 million bags. The ICO daily average price is now 169.76 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 there were 0 contracts tendered for delivery against December contracts and that total deliveries for the month are 118 contracts.
Chart Trends: Trends in New York are mixed. Support is at 175.00, 169.00, and 165.00 March, and resistance is at 188.00, 191.00 and 194.00 March. Trends in London are up with objectives of 2700 January. Support is at 2500, 2470, and 2440 January, with resistance at 2590, 2630, and 2650 January.

SUGAR
General Comments: New York and London closed higher yesterday in recovery trading and despite changes in the Brazil weather and on reports of greatly increased availability of Ukrainian Sugar in the EU. Better than expected rains fell in Brazil over the weekend and Brazil weather forecasts now call for a return to wet in the south and continued showers and rains in central and northern areas this week. 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 or at least not offering in large amounts except for Ukraine, and demand is still strong. Brazil ports are very congested so shipment of Sugar has been slower.
Overnight News: Brazil will get rains 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 down with objectives of 2460 and 2440 March. Support is at 2460, 2440, and 2420 March and resistance is at 2600, 2630, and 2650 March. Trends in London are down with no objectives. Support is at 687.00, 674.00, and 655.00 March, with resistance at 714.00, 719.00, and 729.00 March.

COCOA
General Comments: New York and London closed lower on what appeared to be speculative long liquidation as prices have had a significant recovery in recent weeks. Traders are worried about another short production year and these feelings have been enhanced by El Nino that could threaten West Africa crops with hot and dry weather later this 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 and the harvest is coming. Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast and Ghana continue,
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 4.329 million bags. ICE NY said that 0 notices were posted for delivery against December contracts and that total deliveries for the month are now 775 contracts.
Chart Trends: Trends in New York are mixed. Support is at 4040, 4020, and 3980 March, with resistance at 4230, 4290, and 4320 March. Trends in London are mixed. Support is at 3470, 3400, and 3360 March, with resistance at 3570, 3600, and 3630 March.

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