Thursday, December 5, 2013

Sugar falls on increased offers from India, Thailand

By Jack Scoville


General Comments: Futures were lower in both New York and London and made new lows for the move. Traders were talking about increased offers from India and Thailand. All this comes on the back of very high sugarcane production in Brazil. Coopersucar said yesterday that it should have its export warehouse fully open again next month and expects to meet all export targets for this year and next year. The market needs some demand news. Chart trends remain down in New York and London. Countries like India and Thailand are selling as much as possible. Weather conditions in key production areas around the world are rated as mostly good.

Overnight News: Brazil could see showers tomorrow, but mostly dry weather, and near to above normal temperatures.

Chart Trends: Trends in New York are down with no objectives. Support is at 1640, 1610, and 1580 March, and resistance is at 1685, 1700, and 1715 March. Trends in London are down with objectives of 446.00 March. Support is at 446.00, 440.00, and 434.00 March, and resistance is at 460.00, 465.00, and 466.00 March.


General Comments: Futures closed higher, but stayed in the recent trading range. Prices are still getting support from the storm that hit the production areas last week. Quality has suffered with the storm, and there is potential for some yield loss as well. There are questions about demand in China as the government there has offered its supplies into the domestic market. It sold half of its offer at the auction last week and will most likely offer more soon. Wire reports indicate that some production has been lost in China after recent bad weather in some growing areas. Brazil conditions are reported to be very good in Bahia. Harvest continues this week in the US, but should get interrupted again late in the week when the cold and snow and rain arrives.

Overnight News: The Delta and Southeast should see some showers and snow late in the week and through the weekend. Temperatures will average below normal. Texas will see rain and snow for the next couple of days, then dry conditions. Temperatures will average much below normal. The USDA spot price is 75.50 ct/lb. today. ICE said that certified Cotton stocks are now 0.206 million bales, from 0.225 million yesterday. USDA said that net Uplad Cotton export sales were 248,600 bales this year and 0 bales next year. Net Pima sales were 5,200 bales this year and 0 bales next year.

Chart Trends: Trends in Cotton are mixed. Support is at 78.00, 77.40, and 76.65 March, with resistance of 79.65, 80.50, and 80.95 March.


General Comments: Futures closed lower again as the weather in Florida remains generally very good. Current above normal readings in northern areas will be replaced by much below temperatures this weekend. No one is predicting any freezing temperatures for Florida. Traders are expecting USDA to show unchanged production in its estimates next week, but to lower production even more in coming production reports. The greening disease has affected crops in a big way and could cause reduced production for the next few years. Growing and harvest conditions in the state of Florida remain mostly good. It has turned drier, which is seasonal, and reports indicate that crops are in good condition. Irrigation water is available. Harvest is increasing. Brazil is seeing near to above normal temperatures and a few showers.

Overnight News: Florida weather forecasts call for mostly dry conditions. Temperatures will average above normal. 

Chart Trends: Trends in FCOJ are mixed to down. Support is at 131.00, 130.00, and 126.00 January, with resistance at 134.00, 140.00, and 141.00 January.


General Comments: Futures were higher in early trading, only to reverse and close lower on the day. London was the leader on the move higher and also on the move lower. London was higher on reports of light offers again from Vietnam due to recent rains and low prices. Roasters and others look for supplies and some have turned to Arabica, although not enough to move New York futures that much. However, it seems that Vietnamese producers might have started to sell, and some speculators decided to cover some longs after futures made some objectives for the move up. The Arabica market is seeing only light offers, but buying interest for Arabica overall remains very limited. Colombia remains the most active seller. The Brazil market there remains quiet as producers wait for prices to rally above the cost of production. The rest of northern Latin America was quiet, but there is talk of a lot of Coffee there as well. Central America is showing light offers as the harvest progresses under mostly good conditions. New York is trading in a range.

Overnight News: Certified stocks are lower today and are about 2.672 million bags. The ICO composite price is now 103.72 ct/lb. Brazil will get scattered showers this weekend. Temperatures will average near to above normal. Colombia should get scattered showers, and Central America and Mexico should get mostly dry weather, but showers are likely in northern Mexico. Temperatures should average near to above normal.

Chart Trends: Trends in New York are mixed. Support is at 107.00, 105.50, and 104.00 March, and resistance is at 113.00, 115.00, and 117.00 March. Trends in London are mixed to up with no objectives. Support is at 1665, 1630, and 1600 January, and resistance is at 1730, 1750, and 1770 January. Trends in Sao Paulo are mixed. Support is at 132.00, 131.00, and 129.00 March, and resistance is at 136.50, 138.00, and 140.00 March.


General Comments: Futures closed lower on long liquidation by speculators. There were reports of increased selling from Ivory Coast last week, and supplies should be available. Ideas of very strong demand are supporting prices, and certified stocks keep dropping in New York. Reports indicate that rains are minimal this week in West Africa, which should help harvest progress and processing progress. Much of West Africa is now reporting reduced production due to stressful conditions earlier in the growing season, but this has yet to bear out in official data outside of Nigeria. The overall fundamental picture should support generally higher prices as the supply situation should be tight once the harvest selling is done. Midcrop production conditions are rated as good

Overnight News: Scattered showers or dry conditions are expected in West Africa. Temperatures will average near to above normal. Malaysia and Indonesia should see scattered showers. Temperatures should average near to above normal. Brazil will get dry conditions and near normal temperatures. ICE certified stocks are lower today at 3.391 million bags.

Chart Trends: Trends in New York are mixed. Support is at 2730, 2700, and 2650 March, with resistance at 2795, 2820, and 2845 March. Trends in London are mixed to down with objectives of 1700 and 1650 March. Support is at 1710, 1680, and 1660 March, with resistance at 1745, 1775, and 1790 March.

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