Softs Report 02/16/2024

COTTON
General Comments: Cotton closed higher yesterday and the price action was strong and attempted to confirm the new up trend after a big sideways pattern of trade on the daily charts. The weekly export sales report showed solid sales and sales are expected to continue strong in the world market for the future. The demand news has been solid in this market for the last several weeks. USDA in its Outlook Forum estimated Cotton planted area and production higher. Demand was also higher but ending stocks showed a slight increase. The charts indicate that trends turned up in the second half of last week. Reports indicate that the US cash market has been moderately active with some producer selling and mill fixing noted. The US economic data has been positive, but the Chinese economic data has not been real positive and demand concerns are still around. 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 but recent demand from China is starting to put those concerns on the back burner.
Overnight News: The Delta will get mostly dry weather and near normal temperatures. The Southeast will see mostly dry conditions and below normal temperatures. Texas will have mostly dry conditions and near to above normal temperatures. The USDA average price is now 90.17 ct/lb. ICE daily certified stocks are now 999 bales, from 999 bales yesterday.
Chart Trends: Trends in Cotton are up with no objectives. Support is at 93.70, 92.40, and 90.00 March, with resistance of 96.00, 97.20 and 98.40 March.

DJ On-Call Cotton – Feb 15
As of Feb 9. On-call positions represent spot cotton sold to or
purchased from a merchant, based on New York cotton futures contracts
of 500-pound bales. Prices are not yet fixed against these contracts.
Source: CFTC
*-denotes changes from the previous week are based on revised data from
last week.
Call Previous Change Call Previous Change
Sales Purchases
Mar 24 12,542 17,801 -5,259 6,121 9,941 -3,820
May 24 20,177 17,086 3,091 2,287 3,081 -794
Jul 24 21,384 20,329 1,055 3,281 3,301 -20
Oct 24 0 0 0 0 0 0
Dec 24 13,440 10,625 2,815 32,377 31,415 962
Mar 25 894 848 46 1,410 1,321 89
May 25 613 613 0 870 860 10
Jul 25 563 563 0 16 16 0
Dec 25 542 542 0 5,890 5,092 798
Mar 26 132 132 0 0 0 0
Total 70,287 68,539 1,748 52,252 55,027 -2,775
Open Open Change
Int Int
Mar 24 40,025 80,491 -40,466
May 24 101,241 77,097 24,144
Jul 24 63,584 59,325 4,259
Oct 24 57 55 2
Dec 24 42,705 36,734 5,971
Mar 25 3,593 3,555 38
May 25 690 648 42
Jul 25 643 649 -6
Dec 25 296 270 26
Mar 26 0 0 0
Total 252,834 258,824 -5,990

FCOJ
General Comments: FCOJ closed sharply higher again yesterday. The daily charts suggest once again that the market is finding a high area, and daily chart trends remain down. Prices had been moving lower on the increased production potential for Florida and the US and also in Brazil. There are no weather concerns to speak of for Florida or for Brazil right now. The weather has improved in Brazil with some moderation in temperatures and increased rainfall amid reports of short supplies in Florida and Brazil are around but will start to disappear as the weather improves and the new crop gets harvested. 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 scattered showers or dry conditions. Temperatures will average near normal. Brazil should get scattered showers and above normal temperatures.
Chart Trends: Trends in FCOJ are mixed. Support is at 360.00, 347.00, and 340.00 March, with resistance at 383.00, 387.00, and 392.00 March.

COFFEE
General Comments: New York and London closed lower once again yesterday as forecasts for good growing conditions through the month of February continue. Robusta offers remain difficult to find and the lack of offer of Robusta remains the main bullish force behind the market action, and reports indicate that Brazil producers are reluctant sellers as well as they apparently have already sold a lot. Also, exchange inventories remain reduced, indicating that futures are too far below cash values to entice people to register for delivery to the exchange. Brazil weather continues to improve for Coffee production but is still not perfect. Rains continued to fall in parts of Brazil Coffee areas. Brazil weather is improving for the best crop production.
Overnight News: ICE certified stocks are unchanged today at 0.302 million bags. The ICO daily average price is now 181.84 ct/lb. Brazil will get mostly scattered showers with near normal temperatures. Central America will get mostly dry conditions. Vietnam will see scattered showers.
Chart Trends: Trends in New York are mixed. Support is at 185.00, 182.00, and 179.00 March, and resistance is at 192.00, 198.00 and 200.00 March. Trends in London are mixed. Support is at 3170, 3140, and 3060 March, with resistance at 3380, 3440, and 3500 March.

SUGAR
General Comments: New York and London closed lower yesterday and the trends are turning down on the daily charts. Slow trading is anticipated for much of this week due to Carnaval and the Lunar New Year holidays. The market continues to see stressful conditions in Asian production areas. There are worries about the Thai and Indian production and talk that India could turn into an importer next year. Offers from Brazil are still active but other origins. are still not offering or at least not offering in large amounts except for Ukraine. Unica in Brazil said that mills crushed 714,000 tons of Sugarcane in the second half of January, up 132% fom last year. Sugar production was 28,000 tons and Ethanol production was 313 million liters.
Overnight News: Brazil will get rains in the south and scattered showers in the north. Temperatures should average above normal. India will get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in New York are mixed to down with objectives of 2130 and 2040 May. Support is at 2190, 2170, and 2110 May and resistance is at 2290, 2340, and 2370 May. Trends in London are mixed to down with objectives of 592.00 and 572.00 May. Support is at 622.00, 614.00, and 601.00 May, with resistance at 644.00, 651.00, and 663.00 May.

COCOA
General Comments: Both markets were higher and kept the short term trends up. Price trends remain mostly up on the daily and weekly charts. Futures have rallied sharply for the past month but exploded higher last week. The availability of Cocoa from West Africa remains restricted and projections for another production deficit against demand for the coming year are increasing. The harvest seems to be coming and demand could be a problem with the current very high prices. Traders are worried about another short production year and these feelings have been enhanced by El Nino that is threatening West Africa crops with hot and dry weather. 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 above normal temperatures. ICE certified stocks are higher today at 4.185 million bags.
Chart Trends: Trends in New York are up with no objectives. Support is at 5800, 5450, and 5330 March, with resistance at 6040, 6090, and 6150 March. Trends in London are up with no objectives. Support is at 4710, 4570, and 4350 March, with resistance at 4940, 5000, and 5060 March.

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