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Wednesday, February 15, 2023 10:41:19 AM
Softs Report: Cotton, OJ, Coffee, Sugar, Cocoa
By: Jack Scoville | February 15, 2023
• COTTON
General Comments: Cotton was a little lower yesterday in directionless trading and still remains inside the trading range created since the beginning of November. Futures are still showing bad demand fundamentals as the weekly export sales reports have shown moderate sales at best. Sales were moderate in the reports released last week. Overall, the demand for US Cotton has not been strong although better demand has developed over the last couple of weeks. Some ideas that demand could soon increase as China could start to open its economy in the next couple of months as Covid outbreaks should start to weaken as people get vaccinated or immune. Covid is now widespread in China so the beneficial economic effects of the opening are being delayed but these effects should start to be felt as the people there achieve immunity over the next few weeks.
Overnight News: The Delta will get scattered showers and near to above normal temperatures. The Southeast will see scattered showers and above normal temperatures. Texas will have mostly dry conditions and below normal temperatures. The USDA average price is now 83.66 ct/lb. ICE said that certified stocks are now 1,147 bales, from 8,900 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 84.20, 83.10, and 82.00 March, with resistance of 87.00, 87.50 and 88.90 March.
• FCOJ
General Comments: FCOJ was sharply higher yesterday after two days of very big long liquidation and lower prices. Chart trends are up on the daily and weekly charts. Demand should start to improve as the northern Winter passes by. 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.
Overnight News: Florida should get mostly dry conditions. Temperatures will average near to below normal. Brazil should get scattered showers and near normal temperatures.
Chart Trends: Trends in FCOJ are mixed. Support is at 230.00, 220.00, and 214.00 March, with resistance at 245.00, 253.00, and 256.00 March.
• COFFEE
General Comments: New York and London closed higher again yesterday and New York led the way on follow through buying tied to speculation about a reduced size of the Brazil production. Price trends are turning up on the charts. Ideas of big production for Brazil continue due primarily to rains falling in Coffee production areas now and as offers stayed strong from Brazil and increasingly from Vietnam. Vietnam is estimated to have veery good production this year due to a good growing season and less rain now as harvest expands again. There are ideas that production potential for Brazil had been overrated. The weather in Brazil is currently very good for production potential but worse conditions seen earlier in the growing cycle hurt the overall production prospects as did bad weather last year.
Overnight News: ICE certified stocks are lower today at 0.870 million bags. The ICO daily average price is now 176.25 ct/lb. Brazil will get isolated showers in northern areas with near to above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers.
Chart Trends: Trends in New York are mixed to up with objectives of 193.00, 204.00, and 206.00 March. Support is at 177.00, 174.00, and 172.00 March, and resistance is at 184.00, 186.00 and 192.00 March. Trends in London are mixed. Support is at 2050, 2020, and 2000 March, and resistance is at 2090, 2110, and 2120 March.
• SUGAR
General Comments: New York and London closed higher yesterday and trends are mixed on the daily charts. The US Dollar was a little weaker to support stronger prices in Sugar. Ideas are that the market has priced in production losses in India and Brazil and is providing renumeration for Indian and Thai exporters who want to sell. Thailand expects to export 9.0 million tons of Sugar in the current crop year, 7% more than last year. Ideas of better supplies coming might keep futures prices in check even with a rather tight nearby scenario. Good production prospects are seen for crops in central and northern areas of Brazil, but the south should turn dry again and so should some northern areas. The harvest is active in Thailand. Australia and Central America harvests are also active. Mills in Brazil are shutting down now with the majority of the harvest now complete and processed. European production is expected to be reduced again this year.
Overnight News: Brazil will get scattered showers. Temperatures should average near to above normal. India will get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in New York are mixed. Support is at 1960, 1940, and 1900 May and resistance is at 2030, 2050, and 2080 May. Trends in London are mixed. Support is at 557.00, 549.00, and 543.00 May and resistance is at 574.00, 575.00, and 582.00 May.
• COCOA
General Comments: New York closed slightly lower and London closed a little higher yesterday as the US Dollar also moved slightly lower due to US inflation data. Inflation was higher than expected and should be enough to keep the FED in a tightening mode for a while. Talk is that hot and dry conditions reported in Ivory Coast could curtail mid crop production, but main crop production ideas are strong. Ghana has reported a disease in its Cocoa to hurt production potential there. The rest of West Africa appears to be in good condition. Good production is reported for the main crop and traders are worried about the world economy moving forward and how that could affect demand. Supplies of Cocoa are large at ports. The weather is good in Southeast Asia.
Overnight News: Mostly dry conditions 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 scattered showers and near to above normal temperatures. ICE certified stocks are higher today at 5.033 million bags.
Chart Trends: Trends in New York are mixed to up with objectives of 2730, 2740, and 2750 March. Support is at 2590, 2530, and 2510 March, with resistance at 2650, 2670, and 2700 March. Trends in London are mixed. Support is at 2000, 1950, and 1930 March, with resistance at 2060, 2090, and 2120 March.
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By: Jack Scoville | February 15, 2023
• COTTON
General Comments: Cotton was a little lower yesterday in directionless trading and still remains inside the trading range created since the beginning of November. Futures are still showing bad demand fundamentals as the weekly export sales reports have shown moderate sales at best. Sales were moderate in the reports released last week. Overall, the demand for US Cotton has not been strong although better demand has developed over the last couple of weeks. Some ideas that demand could soon increase as China could start to open its economy in the next couple of months as Covid outbreaks should start to weaken as people get vaccinated or immune. Covid is now widespread in China so the beneficial economic effects of the opening are being delayed but these effects should start to be felt as the people there achieve immunity over the next few weeks.
Overnight News: The Delta will get scattered showers and near to above normal temperatures. The Southeast will see scattered showers and above normal temperatures. Texas will have mostly dry conditions and below normal temperatures. The USDA average price is now 83.66 ct/lb. ICE said that certified stocks are now 1,147 bales, from 8,900 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 84.20, 83.10, and 82.00 March, with resistance of 87.00, 87.50 and 88.90 March.
• FCOJ
General Comments: FCOJ was sharply higher yesterday after two days of very big long liquidation and lower prices. Chart trends are up on the daily and weekly charts. Demand should start to improve as the northern Winter passes by. 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.
Overnight News: Florida should get mostly dry conditions. Temperatures will average near to below normal. Brazil should get scattered showers and near normal temperatures.
Chart Trends: Trends in FCOJ are mixed. Support is at 230.00, 220.00, and 214.00 March, with resistance at 245.00, 253.00, and 256.00 March.
• COFFEE
General Comments: New York and London closed higher again yesterday and New York led the way on follow through buying tied to speculation about a reduced size of the Brazil production. Price trends are turning up on the charts. Ideas of big production for Brazil continue due primarily to rains falling in Coffee production areas now and as offers stayed strong from Brazil and increasingly from Vietnam. Vietnam is estimated to have veery good production this year due to a good growing season and less rain now as harvest expands again. There are ideas that production potential for Brazil had been overrated. The weather in Brazil is currently very good for production potential but worse conditions seen earlier in the growing cycle hurt the overall production prospects as did bad weather last year.
Overnight News: ICE certified stocks are lower today at 0.870 million bags. The ICO daily average price is now 176.25 ct/lb. Brazil will get isolated showers in northern areas with near to above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers.
Chart Trends: Trends in New York are mixed to up with objectives of 193.00, 204.00, and 206.00 March. Support is at 177.00, 174.00, and 172.00 March, and resistance is at 184.00, 186.00 and 192.00 March. Trends in London are mixed. Support is at 2050, 2020, and 2000 March, and resistance is at 2090, 2110, and 2120 March.
• SUGAR
General Comments: New York and London closed higher yesterday and trends are mixed on the daily charts. The US Dollar was a little weaker to support stronger prices in Sugar. Ideas are that the market has priced in production losses in India and Brazil and is providing renumeration for Indian and Thai exporters who want to sell. Thailand expects to export 9.0 million tons of Sugar in the current crop year, 7% more than last year. Ideas of better supplies coming might keep futures prices in check even with a rather tight nearby scenario. Good production prospects are seen for crops in central and northern areas of Brazil, but the south should turn dry again and so should some northern areas. The harvest is active in Thailand. Australia and Central America harvests are also active. Mills in Brazil are shutting down now with the majority of the harvest now complete and processed. European production is expected to be reduced again this year.
Overnight News: Brazil will get scattered showers. Temperatures should average near to above normal. India will get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in New York are mixed. Support is at 1960, 1940, and 1900 May and resistance is at 2030, 2050, and 2080 May. Trends in London are mixed. Support is at 557.00, 549.00, and 543.00 May and resistance is at 574.00, 575.00, and 582.00 May.
• COCOA
General Comments: New York closed slightly lower and London closed a little higher yesterday as the US Dollar also moved slightly lower due to US inflation data. Inflation was higher than expected and should be enough to keep the FED in a tightening mode for a while. Talk is that hot and dry conditions reported in Ivory Coast could curtail mid crop production, but main crop production ideas are strong. Ghana has reported a disease in its Cocoa to hurt production potential there. The rest of West Africa appears to be in good condition. Good production is reported for the main crop and traders are worried about the world economy moving forward and how that could affect demand. Supplies of Cocoa are large at ports. The weather is good in Southeast Asia.
Overnight News: Mostly dry conditions 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 scattered showers and near to above normal temperatures. ICE certified stocks are higher today at 5.033 million bags.
Chart Trends: Trends in New York are mixed to up with objectives of 2730, 2740, and 2750 March. Support is at 2590, 2530, and 2510 March, with resistance at 2650, 2670, and 2700 March. Trends in London are mixed. Support is at 2000, 1950, and 1930 March, with resistance at 2060, 2090, and 2120 March.
Read Full Story »»»
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