Softs Report - Thursday, Aug. 26

COTTON
General Comments: Futures were higher again as a tropical system is about to form in the Gulf of Mexico and could hurt Cotton production in the Southeast and Delta next week. Showers are falling in Texas and in the Delta right now. The Southeast is also getting scattered showers. The demand is expected to be strong from Asian countries as world economies recover from Covid lockdowns. Analysts say the demand is still very strong and likely to hold at high levels for the future. However, the expansion of the Delta variant has given pause to the better demand ideas due to fears of economies here and around the world starting to partially lock down again. Production ideas are being impacted in just about all areas due to the weather extremes. It has been very hot in parts of Texas and the Delta and Southeast have had drenching rains at various times in the last couple of months.
Overnight News: The Delta will get isolated showers and near to above normal temperatures and Southeast will get isolated to scattered showers and near to above normal temperatures. Texas will have mostly dry conditions and near to above normal temperatures. The USDA average price is now 92.09 ct/lb. ICE said that certified stocks are now 76,583 bales, from 76,583 bales yesterday. USDA said that net weekly Upland Cotton export sales were 345,100 bales this year and 67,900 bales next year. Net Pima sales were 14,300 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 9240, 9180, and 9100 December, with resistance of 9600, 9670 and 9720 December.

Image by Ulrike Leone from Pixabay

FCOJ
General Comments: FCOJ closed a little lower yesterday after the big rally the day before. Futures held support areas on the daily charts and trends are still up. Temperatures are now at or above seasonal averages in Brazil after a freeze even a few weeks ago. Weather conditions in Florida are rated mostly good for the crops. Mexican crop conditions in central and southern areas are called good with rains, but earlier dry weather might have hurt production. Northeastern Mexico areas are too dry, but the rest of northern and western Mexico are rated in good condition.
Overnight News: Florida should get scattered showers. Temperatures will average near to above normal. Brazil should get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in FCOJ are up with no objectives. Support is at 139.00, 135.00, and 131.00 September, with resistance at 147.00, 150.00, and 153.00 September.

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