Softs Report - Friday, Dec. 16

General Comments: Cotton was a little lower after another week of bad export sales and on reports of big supplies at US mills. The US Dollar was very strong yesterday amid recession fears to hurt demand ideas. Some ideas that demand could soon increase as China could start to open its economy in the next couple of months continued to support prices. Demand has not been real strong so far this year and the weekly export sales report last week was bad once again. Demand has not improved with the reduction in prices and a lower US Dollar to date. China had been making some initial moves to open its economy and country again but many cities remain in lockdown due to an increase in Covid infections. China saw protests that were sparked by the deaths of several apartment dwellers in a city that protesters said was locked and on lockdown status. There are reports that China has ended its zero tolerance Covid policies and is allowing for greater freedom by citizens. Production in the US is very short.
Overnight News: The Delta will get mostly dry conditions and below normal temperatures. The Southeast will see scattered showers and above normal temperatures. Texas will have mostly dry conditions or isolated showers and below normal temperatures. The USDA average price is now 80.24 ct/lb. ICE said that certified stocks are now 8,901 bales, from 8,901 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 78.80, 77.50, and 77.30 March, with resistance of 82.50, 83.20 and 85.40 March.

white flower field during daytime

Photo by Jeff Hutcheson on Unsplash

General Comments: FCOJ was lower yesterday on weakening demand ideas as domestic demand could be less with the holidays and end of the year coming very soon. Ideas are that much of the bullish news is now in the market. USDA estimated Florida production at just 20 million boxes for Oranges this month, down 29% from last month and down 51% from last year. The supply situation in the US and in the world market looks tight. Historically low estimates of production due in part to the hurricanes and in part to the greening disease has hurt production remain in place but are apparently part of the price structure now. The weather remains generally good for production around the world for the next crop but not for production areas in Florida that have been impacted in a big way by the two storms. Brazil has some rain and conditions are rated good. Mostly dry conditions are in the forecast for the coming days. Florida Citrus said that FCOJ inventories re now 40.3% below last year.
Overnight News: Florida should get mostly dry conditions. Temperatures will average above normal. Brazil should get scattered showers and near to above normal temperatures.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 296.00 January. Support is at 202.00, 198.00, and 196.00 January, with resistance at 212.00, 216.00, and 219.00 January.

General Comments: New York closed higher yesterday on reports that a big hail storm might have damaged produc4tion in Brazil. London closed mixed as producers and buyers are quiet right now in Vietnam. Ideas of reduced Brazil production and reports of reduced offers into the cash market from Brazil and Vietnam continue, but the weather is good in Brazil and improving in Vietnam. Also, CECAFE showed increased November exports in data released early this week. Brazil exported 3.7 million bags of Coffee in November, up 14.7% from last year. There are ideas that production potential for Brazil had been overrated and reports of too much rain in Vietnam affecting the harvest progress. The weather in Brazil is currently very good for production potential but worse conditions seen earlier in the growing cycle hurt the overall production prospects as did bad weather last year. Ideas are that the market will have more than enough Coffee when the next harvest comes in a few months. CONAB in Brazil raised its production estimate slightly to 50.9 million bags, from 50.4 million in September. Arabica production was estimated at 32.7 million bags and Robusta production was estimated at 18.2 million bags.
Overnight News: ICE certified stocks are higher today at 0.732 million bags. GCA stocks are now 6.390 million bags, from 6.320 million last month. The ICO daily average price is now 160.87 ct/lb. Brazil will get isolated showers in northern areas with near to above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE said that 80 contracts were tendered for delivery against December futures and that total deliveries for the month are now 1,672 contracts.
Chart Trends: Trends in New York are mixed. Support is at 165.00, 181.00, and 157.00 March, and resistance is at 177.00, 183.00 and 186.00 March. Trends in London are mixed. Support is at 1880, 1870, and 1840 January, and resistance is at 1950, 1970, and 1990 January.

General Comments: New York and London closed lower yesterday after making new highs for the move in part due to a stronger US Dollar and despite what seems to be strong demand. The harvest has also been delayed in Thailand. India is producing White Sugar mostly from Raws imported from Brazil, so the market is thought to be short Raw Sugar. Akistan has lifted its ban on Sugar exports and now will allow up to 100,000 tons to be sold. The weather in Brazil remains good for the next crop but bad for harvest and loading at ports as it is still raining in production areas. Even so, the center-south crush was reported by UNICA at 16.2 million tons, an increase of 318.6% from last million tons of Sugar were produced and 887.3 million liters of Ethanol were produced. Sugar production was up 532% from a year ago and Ethanol production was up 148%. World Sugar is expected to be in a big surplus production next year. The supply is starting to increase. Brazil Sugar offers are increasing on ideas of unprofitable Ethanol prices coming to the country and reports of increased use of Corn for Ethanol production
Overnight News: Brazil will get scattered showers. Temperatures should average near normal. India will get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in New York are mixed to up with objectives of 2070 and 2160 March. Support is at 1990, 1950, and 1930 March and resistance is at 2040, 2050, and 2060 March. Trends in London are mixed to up with objectives of 572.00 and 602.00 March. Support is at 541.00, 531.00, and 522.00 March and resistance is at 548.00, 552.00, and 556.00 March.

General Comments: New York and London were lower again on what appeared to be speculative long liquidation. Ivory Coast arrivals appear to have improved lately with the recent rally in futures prices. Ivory coast arrivals are now 954,000 tons, up 10% from last year. Ivory Coast arrivals at ports are now 838,000 tons, up 6% from last year. Good production is reported and traders are worried about the world economy moving forward and how that could affect demand. Supplies of Cocoa are as large as they will be now for the rest of the marketing year. Reports of scattered showers along with very good soil moisture from showers keep big production ideas alive in Ivory Coast. The weather is good in Southeast Asia.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see scattered showers. Temperatures should average above normal. Brazil will get scattered showers and near to above normal temperatures. ICE certified stocks are lower today at 5.294 mi0lion bags.
Chart Trends: Trends in New York are mixed. Support is at 2500, 2470, and 2460 March, with resistance at 2560, 2570, and 2590 March. Trends in London are mixed. Support is at 1920, 1880, and 1850 March, with resistance at 1980, 2000, and 2020 March.

More By This Author:

Grains Report - Thursday, Dec. 15
SoftsReport - Wednesday, Dec. 14
Softs Report - Tuesday, Dec. 13

Disclaimer: A Subsidiary of Price Holdings, Inc. – a Diversified Financial Services Firm. Member NIBA, NFA Past results are not necessarily indicative of future results. Investing in ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.