Softs Report - Thursday, July 29

General Comments: Futures were a little higher again on demand concerns as ideas of strong demand continue. 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. Texas has also seen a lot of rain but now could turn hot and dry again.
Overnight News: The Delta will get mostly dry conditions and near to above normal temperatures and Southeast will get 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 86.80 ct/lb. ICE said that certified stocks are now 100,268 bales, from 100,268 bales yesterday.
Chart Trends: Trends in Cotton are mixed to up with objectives of 9130, 9250 and 9460 December. Support is at 8990, 8890, and 8800 December, with resistance of 9120, 9180 and 9240 December.

Image by zanna-76 from Pixabay

General Comments: FCOJ closed lower after failing to extend the recent rally despite reports of freezing temperatures in Sao Paulo Brazil that could affect the production of Oranges in the state and forecasts for more cold weather late this week. Temperatures are likely to get cold but maybe not cold enough to damage trees and fruit. 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. Brazil is reported to be cold and dry. 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 normal. Brazil should get mostly dry conditions and below normal temperatures. ICE said that 0 notices were posted for delivery against July contracts and that total deliveries for the month are now 0 contracts.
Chart Trends: Trends in FCOJ are up with objectives of 142.00 September. Support is at 134.00, 130.00, and 128.00 September, with resistance at 144.00, 147.00, and 150.00 September.

General Comments: New York and London closed lower on forecasts for less severe cold later this week in Brazil. The market had traded sharply higher early this week on freezing temperatures in Brazil growing areas early last week and forecasts for more later this week. The current freeze forecast is in some doubt as not all forecasters see such a cold outbreak developing even though everyone expects some cold weather again. It is not yet known how extensive the damage was but ideas are that a significant part of the cop got hurt. The forecasts for freezing temperatures later this week mean more damage is possible. It is flowering time for the next crop and the flowers were frozen and will drop off the trees. London remains firm overall on some speculative and commercial buying tied to dry weather in Southeast Asia and on reports that Vietnamese producers were not selling or delivering. Some of the buying was tied to the big rally in New York as well. Temperatures are uncertain in Brazil. There were some losses created by a hot and dry start to the growing season that impacted flowering and initial cherry development and a little Coffee was lost during the freeze event several weeks ago. Showers are coming this week to Southeast Asia and tree condition should be improved. Good conditions are reported in northern South America and good conditions reported in Central America. Colombia is having trouble exporting Coffee due to protests inside the country. Conditions are reported to be generally good in parts of Asia and parts of Africa.
Overnight News: ICE certified stocks are a little lower today at 2.176 million bags. The ICO daily average price is now 173.53 ct/lb. Brazil will get mostly dry conditions with below normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers.
Chart Trends: Trends in New York are mixed. Support is at 195.00, 193.00, and 187.00 September, and resistance is at 209.00, 215.00 and 220.00 September. Trends in London are mixed to up with no objectives. Support is at 1900, 1860, and 1780 September, and resistance is at 1990, 2020, and 2050 September.

General Comments: New York and London were higher as freezing temperatures re-forecast to hit Sugarcane areas of Brazil and probably cause some additional significant damage. Ideas are that the damage should show un in processing data for August. More cold temperatures are in the forecast for later this week. Reports of damaged cane in Brazil and pictures of the damage were tweeted. The pictures are showing the potential for significant damage to crops. Mills were also processing for more Ethanol and less for Sugar than expected and this trend should continue even with weaker world petroleum prices. London has been the weaker market on ample supplies of White Sugar available to the market and as demand for White Sugar is less. There is plenty of White Sugar available in India for the market and monsoon rains are promoting good conditions for the next crop. Thailand is expecting improved production. Sugar demand is said to be weak. Ethanol demand is returning to the market as more world economies open up after the pandemic.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average below normal.
Chart Trends: Trends in New York are mixed to up with objectives of 1880 and 1980 October. Support is at 1810, 1780, and 1750 October, and resistance is at 1880, 1910, and 1940 October. Trends in London are mixed. Support is at 452.00, 448.00, and 446.00 October, and resistance is at 464.00, 466.00, and 470.00 October.

General Comments: New York and London closed higher again yesterday on ideas of increasing demand and on speculative short covering. It appears that the supply fundamentals are now part of the price structure for Cocoa. The European grind data was released recently and showed a strong recovery from the Covid times. Asian data was released a week ago and also showed increased demand, although not as much of an increase than showed for Europe. The North American data also showed increased demand. World economies are starting to reopen after Covid and the open economies are giving demand the boost. Ports in West Africa are filled with Cocoa right now. The weather has had above average rains in West Africa and crop conditions are rated good.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be above 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 higher today at 5.799 million bags.
Chart Trends: Trends in New York are mixed to up with no objectives. Support is at 2370, 2310, and 2260 September, with resistance at 2440, 2460, and 2500 September. Trends in London are mixed. Support is at 1580, 1570, and 1550 September, with resistance at 1670, 1690, and 1710 September.

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 ...

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