Softs Report 03/27/2024

COTTON
General Comments: Cotton was higher yesterday and held to a trading range on improving ideas of demand potential from China. It is too early to plant in Texas but the heat and dry weather raises concerns about production potential later in the growing season and blackened soils might not permit much planting, anyway. The demand news has been solid but reduced from previous levels in this market for the last several weeks. The US economic data has been positive, but the Chinese economic data has not been real positive and demand concerns are still around. However, Chinese consumer demand has held together well, leading some to think that demand for Cotton in world markets will increase over time.
Overnight News: The Delta will get showers and rains and near normal temperatures. The Southeast will see showers and near normal temperatures. Texas will have mostly dry conditions and near to below normal temperatures. The USDA average price is now 85.86 ct/lb. ICE daily certified stocks are now 43,872 bales, from 41,756 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 92.00, 90.80, and 88.10 May, with resistance of 96.20, 97.70 and 98.40 May.

FCOJ
General Comments: FCOJ closed a little higher yesterday in range trading. Reports of tight supplies are around. Florida said that Oranges production will be low, but above a year ago. Futures still appear to have topped out even with no real downtrend showing yet, so a range trade has been seen. Prices had been moving lower on the increased production potential for Florida and the US and in Brazil but is now holding as current supplies remain very tight amid only incremental relief for supplies is forecast for the coming new crop season. 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.
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 361.00, 347.00, and 353.00 May, with resistance at 378.00, 389.00, and 391.00 May.

COFFEE
General Comments: Both markets closed higher again yesterday, and New York held to a trading range as the lack of Robusta Coffee in the market continues to support futures. Trends in London are up again. Robusta offers from Vietnam remain difficult to find and the lack of offer of Robusta is a bullish force behind the London market action. Vietnamese producers are reported to have about a quarter of the crop left to sell or less and reports indicate that Brazil producers are reluctant sellers for now after selling a lot earlier in the year. Brazil weather continues to improve for Coffee production and conditions are called good. Rains continued to fall in parts of Brazil Coffee areas.
Overnight News: ICE certified stocks are higher today at 0.560 million bags. The ICO daily average price is now 190.02 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 183.00, 179.00, and 178.00 May, and resistance is at 188.00, 190.00 and 194.00 May. Trends in London are up with objectives of 3520 and 3590 May. Support is at 3420, 3360, and 3320 May, with resistance at 3540, 3570, and 3600 May.

SUGAR
General Comments: New York and London closed higher yesterday and trends are up in both markets. Ideas of stronger demand have surfaced, and producers do not appear to be selling much. Indian production estimates are creeping higher but are still reduced from recent years. There are worries about the Thai and Indian production. Offers from Brazil are still active but other origins. are still not offering in large amounts except for Ukraine. Ukraine offers have suffered lately with the war. Demand reports from Europe have been strong. UNICA in Brazil said that the center south Sugar crush was 2.2 million tons in the first half of March, up 272% from last year. Sugar production was 64,000 tons, up 313%, and ethanol production was 367 million liters, up 39%
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 up with objectives of 2280, 2360, and 2390 May. Support is at 2170, 2110, and 2030 May and resistance is at 2260, 2290, and 2320 May. Trends in London are up with objectives of 676.00 and 698.00 May. Support is at 645.00, 619.00, and 612.00 May, with resistance at 663.00, 670.00, and 680.00 May.

COCOA
General Comments: Futures were higher again yesterday and kept the incredible rally going. Production concerns in West Africa as well as demand from nontraditional sources along with traditional buyers keep supporting futures. Production in West Africa could be reduced this year due to the extreme weather which included Harmattan conditions. The availability of Cocoa from West Africa remains very restricted and projections for another production deficit against demand for the coming year are increasing. Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast and Ghana continue. Demand continues to be strong, especially from nontraditional buyers of Cocoa.
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 4.119 million bags.
Chart Trends: Trends in New York are up with objectives of 9970 May. Support is at 9000, 8410, and 7710 May, with resistance at 10080, 10200, and 10320 May. Trends in London are up with no objectives. Support is at 7500, 6960, and 6500 May, with resistance at 8720, 8840, and 8960 May.

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