Morning Softs Comments
MORNING SOFTS COMMENTS
Wednesday, September 11, 2019
Price Futures Group, CBOT
JSL, SA de CV
San Salvador, El Salvador (503) 2260-7806 firstname.lastname@example.org
General Comments: Cotton was a little higher in very narrow range trading. Many are getting ready for the USDA reports that will be issued on Thursday. The trade forecasts production at 21.97 million bales, with exports at 16.78 million bales and ending stocks at 7.14 million bales. It is possible that futures are trying to form a bottom. USDA lowered crop condition ratings in a significant way in its Monday night data. Bolls are starting to open now and the fiber could be colored or could the bolls could drop if there is enough wind. Conditions in the Texas Panhandle have improved with some recent showers and ideas are that production potential had been stabilized. Texas crops have been hurt by continued hot and dry weather, although the Panhandle region has seen some rains lately. It has been a relentless move lower since April and the entire down move now extends to the early summer of 2018. Traders are anticipating bearish USDA reports this week. Production is expected to be lower due to earlier bad weather in the Texas Panhandle. Demand could be cut even more as export demand in general has been weak and ending stocks for the current and the next crop years could be increased. Demand remains a real problem for the market as export sales overall have been poor. The world market remains quiet with very limited Chinese buying interest anywhere.
Overnight News: The Delta should be dry and Southeast should see dry conditions. Temperatures should be mostly above normal. Texas will have showers this week and a dry weekend. Temperatures will be variable. The USDA average price is now 55.79 ct/lb. ICE said that certified stocks are now 12,274 ba1es, from 12,802 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 5800, 5750, and 5720 December, with resistance of 6000, 6020, and 6170 December.
General Comments: FCOJ was higher in line with most agricultural markets yesterday. Forecasters are keeping an eye on a couple new systems in the ocean. One does not look like it will be a threat to the state but the one farther out to sea has a chance to develop. Its movement track is unclear right now. It is the high point in the hurricane season so hurricane forecasts will capture much attention from the trade. Chart patterns have turned mixed in response to the hurricane threat that appeared last week and the potential for more systems to form in the short term. The weather in Florida had been good as the state has seen frequent showers and storms that have aided in development in the fruit but it will be mostly dry this week. Inventories in Florida are still well above a year ago. Fruit for the next crop is developing and is reported to have good size. Crop conditions are called good. Brazil is waiting for rains to trigger start of the next crop.
Overnight News: Florida should get mostly dry conditions today, then chances for showrs and storms though the weekend. Temperatures will average near to above normal. Brazil should get mostly dry weather and near to below normal temperatures. ICE said that 0 notices were posted for delivery against September FCOJ contracts and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 101.00, 98.00, and 97.00 September, with resistance at 105.00, 108.00, and 110.00 September.
General Comments: New York closed higher on follow through speculative short covering. London closed higher as well. The chart trends are now up in New York and mixed n London. There is increasing talk of the dry weather in Brazil that is hurting flowering and there are some dry pockets in Colombia. The market is starting to feel smaller crops from Brazil for the current harvest and is seeing projections for smaller crops next year as well due to the current dry weather outlook. However, there are many who think the next crop will be good and could total 70 million bags or more. The Arabica growing areas are waiting for rains to restart flowering after some rains earlier in the year. There are no rains in the forecast for at least the next week. Vietnam crops are thought to be big despite some uneven growing conditions this year. It has been warm and dry at times, then the growing areas have seen some very heavy rains. Demand has been increasing over the last few years on the consumer level, but production potential is growing faster. The weaker production prospects this year should help to hold prices from going much lower.
Overnight News: ICE certified stocks are lower today at 2.326 million bags. The ICO daily average price is now 98.62 ct/lb. Brazil will get mostly dry conditions with near normal temperatures. Vietnam will see scattered showers and storms mostly in the north. ICE said that 2 notices were posted for delivery against September contracts and that total deliveries for the month are now 490 contracts.
Chart Trends: Trends in New York are up with objectives of 103.00 December. Support is at 98.00, 97.00, and 95.00 December, and resistance is at 103.00, 104.00 and 106.00 December. Trends in London are mixed. Support is at 1300, 1290, and 1260 November, and resistance is at 1340, 1360, and 1370 November.
General Comments: New York closed mixed and London was a little lower yesterday. There is talk of dry weather that could affect northern crops in Brazil and the ISO recently called for less production this year than demand. However, the market still thinks there is plenty of Sugar available and is not able to rally on the lower production ideas. World supplies still appear ample for the demand potential. Reports from India indicate that the country still has a large surplus of White Sugar that probably must be exported. India is reporting very good monsoon rains and production prospects for this year have definitely improved after a slow start to the season. The last couple of weeks have featured above average rains. The fundamentals still suggest big supplies, and the weather in Brazil is good enough and India has improved to support some of the big production ideas. The weather has been much more uneven in production areas from Russia into western Europe. Those areas had a very hot and dry start to the growing season. Better weather was seen in early August then it turned hot and dry again. These areas need more rain and some cooler weather to provide better conditions for the final development of the Sugar beets crops.
Overnight News: Brazil will get mostly dry weather. Temperatures should be near normal.
Chart Trends: Trends in New York are down with objectives of 1180 and 1170 March. Support is at 1170, 1140, and 1110 March, and resistance is at 1200, 1220, and 1240 March. Trends in London are down with objectives of 294.00 December. Support is at 306.00, 300.00, and 294.00 December, and resistance is at 310.00, 312.00, and 317.00 December.
General Comments: Futures closed lower as the recovery rally stalled for at least the day. The reports from West Africa imply that a big harvest is possible in the region, The charts show chances to move higher over the short term. The market could start to act weaker as the next main crop harvest comes closer to reality in West Africa. The weather in West Africa is still a feature. The weather in Ivory Coast has improved due to reports of frequent showers. The precipitation is a little less now so there are no real concerns about disease. Ideas are that the next crop will be good. The harvest will start in the Fall. Growing and harvesting conditions in Asia are also reported to be good. The harvest is ongoing amid somewhat drier weather. More and more Asian Cocoa has been staying at home and processed in Indonesia for export in the region. Demand in Asia has been growing and Indonesia has been eager to be the primary source of Cocoa.
Overnight News: Scattered showers and storms are expected in West Africa. Temperatures will be on both sides of normal. Malaysia and Indonesia should see showers. Temperatures should average above normal. Brazil will get mostly dry conditions and near to above normal temperatures. ICE certified stocks are lower today at 3.935 million bags. ICE said that 0 notices were posted for delivery against September contracts and that total deliveries for the month are now 2,118 contracts.
Chart Trends: Trends in New York are up with objectives of 2320 and 2420 December. Support is at 2280, 2230, and 2210 December, with resistance at 2340, 2400, and 2440 December. Trends in London are mixed to up with objectives of 1770 and 1970 December. Support is at 1740, 1710, and 1680 December, with resistance at 1780, 1800, and 1830 December.
141 W. Jackson Blvd. Suite 1920, Chicago, IL 60604 | (800) 769-7021 | (312) 264-4322 (Direct) | www.pricegroup.com
Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures.
The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author.
To SUBSCRIBE to Morning Softs please click here.
To Unsubscribe from Morning Softs please click here.
Click Here to View the Morning Softs Archives