COTTON
General Comments: Cotton was higher on Friday in recovery trading, but lower for the week as export demand remains weak. The export sales report showed improved sales, but the sales were still down overall. Trends are mixed in this market. China moved to lower interest rates again and there are hopes this move will help restart the economic engine there. Real estate has been the big problem there. There are still reports of weaker demand potential against an outlook for improved US production in the coming year.
Overnight News:
Chart Trends: Trends in Cotton are mixed to up. Support is at 69.30, 68.30, and 67.50 December, with resistance of 71.90, 72.70 and 73.50 December.
FCOJ
General Comments: FCOJ closed higher last week and the spot November contract was sharply higher to post a new high and new high close for the move. Trends are mixed to up in this market as the market remains short juice for delivery. USDA cut Florida oranges production to 15 million boxes, from 18 million in its previous report and 20 million last year. The market remains well supported in the longer term based on forecasts for tight supplies in Florida. The reduced production appears to be mostly at the expense of the greening disease. There are no weather concerns to speak of for Brazil right now. Rain is expected this week.
Overnight News:
Chart Trends: Trends in FCOJ are mixed. Support is at 478.00, 471.00, and 460.00 January, with resistance at a 494.00, 499.00, and 506.00 January.
COFFEE
General Comments: New York and London were lower last week on reports of reduced offers from Brazil and Vietnam on weather induced short crops. The harvest in Vietnam is starting again with about 5% of the crop collected. A major storm hit Vietnam over the previous weekend but apparently caused little in the way of damage or loss to crops. The chart trends are mixed in both markets as the harvest in Vietnam is more active. Strong harvest activity is expected to start in Vietnam in November. The demand for Vietnamese Coffee is reported to be less right now and this has been a big problem for bullish traders. Rain remains in the forecast for Brazil crop areas but as crop losses are still a good possibility in Brazil and Vietnam. There are now reports for good rains in Brazil as the rainy season is now under way after very dry conditions. Brazil yields have been a little less so far.
Overnight News: The ICO average price is 241.49 ct/lb.
Chart Trends: Trends in New York are mixed. Support is at 242.00, 236.00, and 228.00 December, and resistance is at 256.00, 265.00 and 2w68.00 December. Trends in London are mixed. Support is at 4300, 4280, and 4000 January, with resistance at 4560, 4670, and 4770 January.
SUGAR
General Comments: New York and London collapsed on Friday and closed lower last week despite reports of too much rain in Brazil. The rains have kept the harvest and crushing pace down but could provide a boost to production for next year. Trends are still sideways in both markets but are trying to turn up again. Harvest progress is active in Brazil and growing conditions are much improved in India and Thailand. Indian and Thai monsoon rains have been very beneficial, and mills are expecting strong crops of cane. It is also wet in Brazil, and this has affected harvest progress. Supplies available to the market could be less in the next six months. Total Brazil production has been affected by drought seen earlier in the year and the fires that destroyed crops in some areas.
Overnight News:
Chart Trends: Trends in New York are mixed. Support is at 2170, 2100, and 2020 March and resistance is at 2300, 2340, and 2360 March. Trends in London are mixed. Support is at 555.00, 552.00, and 541.00 December, with resistance at 584.00, 590.00, and 593.00 December.
COCOA
General Comments: Both markets closed higher last week. Reports of better harvest conditions in West Africa have helped push differentials lower, but it has been wet there and Ghana now estimates production this year at 650,000 tons from 700,000 tons previously. Producers in Ghana are protesting against Cocobod and claim that the authority has been unfair to them. Producers there and in Ivory Coast have been fighting to much rain that has made it hard to harvest and deliver crops. An Ivory Coast government official said that the country could produce 10% more Cocoa this year although he noted that it has been very wet recently and yields could be affected. It has been very wet in West Africa lately and this is bringing concerns that pod disease could develop. Production in West Africa could be stronger this year on the overall improved weather in Ivory Coast and Ghana. Cocoa arrivals at ports in Ivory Coast reached 285,000 tons by Oct. 27.
Overnight News:
Chart Trends: Trends in New York are up. Support is at 6920, 6820, and 6430 December, with resistance at 7450, 7510, and 7650 December. Trends in London are up. Support is at 5620, 5520, and 5380 December, with resistance at 5980, 6060, and 6120 December.More By This Author:Grains Report – Friday, Nov. 1Softs Report – Thursday, Oct. 31Grains Report – Wednesday, Oct. 30
