COTTON
General Comments: Cotton closed higher again yesterday in response to the US WASDE reports. The domestic estimates showed a decrease in production and a smaller decrease in demand for ending stocks of 4.10 million bales. World data showed a slight increase in ending stocks to 82.4 million bales. The export sales report was positive for prices once again this week and featured sales to China. The US 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 above normal temperatures. The Southeast will see isolated showers and above normal temperatures. Texas will have scattered showers and near normal temperatures. The USDA average price is now 78.00 ct/lb. ICE daily certified stocks are now 6,126 bales, from 6,126 bales yesterday. ICE said that 0 notices were posted for delivery against December contracts and that total deliveries for the month are now 815 contracts.
Chart Trends: Trends in Cotton are mixed to up with objectives of 83.70 and 84.60 March. Support is at 80.50, 80.00, and 78.60 March, with resistance of 83.10, 83.70 and 85.50 March.Image Source: PixabayFCOJ
General Comments: FCOJ closed sharply higher to limit up, and the short term trends are still mixed in this market as USDA showed unchanged 2023-24 production estimates for Florida at 20.5 million boxes and the US at 68.5 million boxes in its reports last week. 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 mixed. Support is at 361.00, 352.00, and 346.00 January, with resistance at 398.00, 405.00, and 408.00 January.COFFEE
General Comments: Both markets closed higher yesterday in recovery trading and on less than expected rainfall for Brazil production areas. Arabica and Robusta areas are affected by drought and the rains seen over the weekend were called disappointing. Forecasts call for reduced rainfall totals this week to keep ideas of stress alive. Brazil weather remains uneven for the best crop production, but there are reports of increasing Coffee availability from Vietnam although not enough to meet all of the demand yet. 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.
Overnight News: ICE certified stocks are higher today at 0.235 million bags. The ICO daily average price is now 172.54 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 26 contracts tendered for delivery against December contracts and that total deliveries for the month are 188 contracts.
Chart Trends: Trends in New York are mixed. Support is at 175.00, 169.00, and 165.00 March, and resistance is at 186.00, 188.00 and 191.00 March. Trends in London are mixed to up with objectives of 2700 January. Support is at 2600, 2560, and 2500 January, with resistance at 2670, 2700, and 2730 January.SUGAR
General Comments: New York and London closed lower last week on fund long liquidation tied to 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. ICE NY said that 1,408 Sugar 16 contracts were posted for delivery against January futures.
Chart Trends: Trends in New York are down with objectives of 2200 and 2090 March. Support is at 2200, 2170, and 2140 March and resistance is at 2310, 2390, and 2400 March. Trends in London are down with objectives of 632.00 and 616.00 March. Support is at 631.00, 628.00, and 625.00 March, with resistance at 648.00, 668.00, and 674.00 March.COCOA
General Comments: Both markets closed lower yesterday and held to a trading range. The market is now testing the top end of the range. It looks like the long liquidation to drive prices lower. 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 higher today at 4.274 million bags. ICE NY said that 64 notices were posted for delivery against December contracts and that total deliveries for the month are now 884 contracts.
Chart Trends: Trends in New York are mixed. Support is at 4150, 4100, and 4040 March, with resistance at 4310, 4340, and 4370 March. Trends in London are mixed. Support is at 3480, 3440, and 3400 March, with resistance at 3580, 3600, and 3630 March.More By This Author:Grains Report – Monday, Dec. 11
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