Thursday, March 27, 2014

Crazy cotton

By Jack Scoville


General Comments: Futures were higher and made new highs for the move on follow through buying from lower tan expected Ginning data from USDA, then collapsed on demand worries. The domestic cash market remains tight and is supporting futures prices in the front months, but exporters have told wire services that export demand is vey soft. Most producers appear to be sold out, and spinners in the east are forced to pay up to get supplies. However, many think that demand can start to fade now with the high prices and buying interest is less at this time in futures. Brazil conditions are reported to be good in Bahia with warm temperaturas and a few showers. Warmer temperatures are slowly returning to production áreas in the U.S. and there has been some initial fieldwork done in far southern áreas, but forecasts now call for light precipitation and warmer temperatures this week in the Delta and Southeast. The Texas Panhandle was getting very welcome rains this morning. Producers plan to plant more Cotton this year, so supplies should be more next year as long as good growing conditions are seen.

Overnight News: Delta and Southeast áreas will get light showers Friday and Saturday, otherwise dry weather. Temperatures will average near to above normal late in the week. Texas will see mostly dry weather. Temperatures will average near to above normal at the end of the week and above normal this weekend, then near normal early next week. The USDA spot price is 86.51 ct/lb. today. ICE said that certified Cotton stocks are now 0.254 million bales, from 0.254 million yesterday. USDA said that net Upland Cotton export sales were 66,300 tons this year and 76,600 tons next year. Net Pima sales were 12,700 bales this year and 2,000 bales next year.

Chart Trends: Trends in Cotton are mixed. Support is at 90.50, 89.90, and 88.60 May, with resistance of 91.80, 92.50, and 93.30 May.


General Comments: Futures closed a little higher after showing weakness on Tuesday. Forecasts for improved rains later this week in production áreas was negative. But, mostly the market is worried about the potential loss of demand and knows it is too early to worry about the hurricane season, which is the next major production risk for weather. Greening Disease and reduced Florida production keeps the prices supported. The weather is still good in Florida. Brazil has seen weather might that be stressing trees as reports indicate that many áreas still need rain. Mostly dry weather is in the forecast for Brazil. Florida harvest conditions remain good. The Valencia harvest is strong. Blooms are being reported in all parts of Florida. Demand remains a big problem for the Bulls. Many consumers continue to look for other sources of nutrition that is found in Orange Juice due to the higher prices that are coming from the lower production in Florida and Brazil.

Overnight News: Florida weather forecasts call for mostly dry conditions, but afternoon showers are starting to arrive. Temperatures will average near to above normal,but will be cool on Thursday. Brazil should be mostly dry and warm. 

Chart Trends: Trends in FCOJ are down with objectives of 143.00 and 135.00 May. Support is at 147.00, 144.00, and 142.00 May, with resistance at 151.00, 152.50, and 155.00 May.


General Comments: Futures closed a little higher in consolidation trading as many traders wonder just how much Coffee was lost or damaged in brazil. The rains in March have been beneficial, even aftter less than expected rains over the weekend. Current forecasts for Brazil call for mostly dry conditions for the next week. London was slightly higher, but stays supported by the possibility of production losses for the next crop in Vietnam. The lack of rain in Coffee producing áreas of Brazil since the beginning of the year has hurt Coffee production potential. Exports so far this year from Vietnam have been less than last year and might stay weak if the weather does not improve there. Producers are supposed to own a lot of Coffee there but want to see the production for next year before unloading a lot of bags on the market. Cash markets have become more animated this week in Latin America.

Overnight News: Certified stocks are lower today and are about 2.578 million bags. The ICO composite price is now 157.15 ct/lb. Brazil will get mostly dry weather. Temperatures will average near to above normal. Colombia should get scattered showers, and Central America and Mexico should get mostly dry weather, although some showers are expected in Eastern Mexico. Temperatures should average near to above normal.

Chart Trends: Trends in New York are mixed. Support is at 172.00, 169.00, and 166.00 May, and resistance is at 179.00, 181.00 and 184.00 May. Trends in London are mixed to down with no objectives. Support is at 2050, 2015, and 1985 May, and resistance is at 2100, 2130, and 2175 May. Trends in Sao Paulo are mixed. Support is at 212.00, 209.00, and 207.50 September, and resistance is at 222.00, 231.00, and 238.00 September.


General Comments: Futures were higher, with London White Sugar futures leading the way. Indications that higher prices are being seen in India for domestic and export markets supported London and also New York. India remains a wild card for exports due to massive subsidies. It subsidizes producers and now exporters aned that makes it very hard for the country to offer exports at reasonable prices while obeying WTO rules. The weather in Brazil remains important, and regular rains are still needed. Mostly dry conditions are expected for the next week, and some traders are talking about a weather led rally coming soon. The market still has plenty of product. Brazil might have less Sugar, but there still seems to be enough in the market from Thailand and the demand side does not seem strong. Thailand has been selling Sugar with steady or weaker differentials. Demand news remains hard to find. Weather conditions in key production áreas around the world are rated as mostly good except for the dry weather in Brazil.

Overnight News: Brazil could see mostly dry weather and near to above normal tempertures. Cargill and Coopersucar have agreed to set up a world marketing joint venture. Fixed assets would remain the property of the individual operations but marketing will be combined.

Chart Trends: Trends in New York are mixed to up with objectives of 1760, 1870, and 1970 May. Support is at 1700, 1660, and 1640 May, and resistance is at 1760, 1790, and 1810 May. Trends in London are mixed to up with objectives of 470.00, 490.00, and 502.00 May. Support is at 453.00, 446.00, and 440.00 May, and resistance is at 471.00, 479.00, and 485.00 May.


General Comments: Futures closed mixed, and remains in the trading range. The market needs a new factor to push prices one way or another. The idea of ever increasing Asian demand has encountered some resistance as the Chinese economy has shown some weakness. Better tan forecast production in West Afica and Asia has also hurt the bull case. Bears have not been able to break futures from the sideways longer term range, either as overall the market remains tight Mid crop conditions seem fair to good in West Africa and generally good in Southeast Asia. It remains generally too dry for best midcrop development in Ghana and Ivory Coast and a little too dry in Malaysia, but conditions have improved. Rains have been reported this week in some of the drier parts of West Africa in the last couple of weeks. Butter ratios remain strong on ideas of short supplies of Cocoa Butter in Europe and North America. Asian demand has been strong.

Overnight News: Mostly dry weather is expected in West Africa, but a few showers are posible in southern areas. Temperatures will average mostly above normal. Malaysia and Indonesia should see scattered showers, with best amounts and coverage in Indonesia. Temperatures should average near to above normal. Brazil will get dry conditions or light showers and near to above normal temperatures. ICE certified stocks are lower today at 4.738 million bags.

Chart Trends: Trends in New York are mixed. Support is at 2920, 2900, and 2880 May, with resistance at 3000, 3010, and 3050 May. Trends in London are mixed. Support is at 1855, 1840, and 1825 May, with resistance at 1890, 1900, and 1920 May.

See the original article >>

No comments:

Post a Comment

Follow Us