COTTON
General Comments: Cotton was a little lower yesterday as continued stressful weather was seen in the south. There are still ideas of weaker demand potential against an outlook for improved US production in the coming year. There have been demand concerns about Bangladesh and China and ideas are that production is strong enough. The Delta should have the best looking crops right now, but crops in other areas are more suspect. Texas and the Southeast have seen some extreme heat so far this year, and Texas has also seen dry conditions at times during the growing season. Demand has been weaker so far this year but there are hopes for improved demand with the lower prices.
Overnight News:
Chart Trends: Trends in Cotton are up. Support is at 71.50, 70.20, and 69.30 December, with resistance of 75.80, 77.70 and 79.40 December.
FCOJ
General Comments: FCOJ closed lower again yesterday as the hurricane hit Florida but missed most production areas. A new tropical system is a category 2 or 3 storm. The northern half of the state will be affected. A very active year has been forecast but has yet to come true. 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 Florida or for Brazil right now although reports indicate that Brazil is hot and dry. Ideas are that demand has suffered recently with the move to extremely high prices.
Overnight News:
Chart Trends: Trends in FCOJ are mixed. Support is at 468.00, 453.00, and 438.00 November, with resistance at a 491.00, 487.00, and 506.00 NovemberCOFFEE
General Comments: New York and London closed higher again yesterday and made new contract highs on the daily charts as the dry Brazil and Vietnam weather patterns remained the main focus. More reports of dry weather that could be hurting production potential had been supporting futures in both markets. Indonesian offers are still less as producers wait for higher prices before selling. Damage was done to crops earlier in the growing season in Vietnam and lower production is now expected for the next crop. It is still dry there.
Overnight News:
Chart Trends: Trends in New York are up. Support is at 262.00, 256.00, and 248.00 December, and resistance is at 278.00, 284.00 and 290.00 December. Trends in London are down. Support is at 5280, 5010, and 4910 November, with resistance at 5600, 5660, and 5720 November.SUGAR
General Comments: New York and London closed lower yesterday on some profit taking after New York failed to hold at new contract highs and as London could not make new contract highs set early in the week. More reports of burning crops in Brazil and on dry conditions seen generally in Brazil continued to support both markets overall. Harvest progress in Brazil and improved growing conditions in India and Thailand are the important fundamentals and growing conditions are dry in Brazil. Indian and Thai monsoon rains have been very beneficial and mills are expecting strong crops of cane. They are pushing the governments to allow exports but the governments have not agreed to allow any exports. Production estimates were raised in the northern hemisphere.
Overnight News:
Chart Trends: Trends in New York are up. Support is at 2250, 2200, and 2100 March and resistance is at 2400, 2460, and 2520 March. Trends in London are up. Support is at 590.00, 575.00, and 552.00 December, with resistance at 602.00, 610.00, and 616.00 December.COCOA
General Comments: New York and London closed higher but well off the highs of the day caused by chart based buying. There are still ideas of tight supplies available to the market now as production for the next crop looks to be improved. However, news reports indicate that governments in West Africa have been forcing producers and traders to liquidate stocks and make more available to the market. Production in West Africa could be stronger this year on currently wetter weather in Ivory Coast. Above average rain is now forecast for the next couple of weeks to improve conditions in West Africa. The availability of Cocoa from West Africa remains very restricted, but surplus production against demand is expected in the next crop year.
Overnight News:
Chart Trends: Trends in New York are mixed. Support is at 7780, 7470, and 7200 December, with resistance at 8550, 8710, and 8830 December. Trends in London are mixed. Support is at 5140, 4960, and 4870 December, with resistance at 5730, 5800, and 5900 December.More By This Author:
Softs Report – Friday, Sept. 27
