Softs Report - Thursday, Aug. 5

General Comments: Futures were a little higher again yesterday on hopes for improved demand against ideas of good US production. Ideas of strong demand continue but the weekly reports have shown more like an average demand. 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. Production ideas are being impacted in just about all areas due to the weather extremes. It has been very hot in parts of Texas with some dry pockets noted, and the Delta and Southeast have had drenching rains at various times in the last couple of months. The Texas Panhandle is expecting beneficial showers this week.
Overnight News: The Delta will get mostly dry conditions and near to below normal temperatures and Southeast will get isolated to scattered showers and near to below normal temperatures. Texas will have isolated showers and near to below normal temperatures. The USDA average price is now 86.61 ct/lb. ICE said that certified stocks are now 91,059 bales, from 97,148 bales yesterday. USDA said that net Upland Cotton export sales were 25,300 bales this year and 160,700 bales net year.. Net Pima sales were 2,500 bales this year and 9,100 bales next year.
Chart Trends: Trends in Cotton are mixed. Support is at 8890, 8800, and 8590 December, with resistance of 9130, 9180 and 9240 December.

Image by zanna-76 from Pixabay

General Comments: FCOJ closed higher yesterday as Florida weather remains nonthreatening and the cold weather has passed in Brazil. Reports of freezing temperatures in Sao Paulo Brazil that could affect the production of Oranges in the state supported futures overall. Freezing temperatures have been reported in the state in the last couple of weeks. Weather conditions in Florida are rated mostly good for the crops. The Atlantic is quiet and nothing has formed to threaten the state of Florida yet. A big storm could threaten trees and fruit. 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. Demand news has been bad with Nielsen reporting sales at $30.2 million and a third month of declining sales. The sales are now the weakest since the Pandemic began.
Overnight News: Florida should get scattered showers. Temperatures will average near normal. Brazil should get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in FCOJ are down with objectives of 126.00 September. Support is at 128.00, 126.00, and 125.00 September, with resistance at 137.00, 142.00, and 144.00 September.

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