Photo by Marianne Krohn on Unsplash

Cotton

General Comments: Cotton futures closed higher yesterday and at new highs for the move on good demand as seen in the weekly export sales report and despite ideas of Chinese import problems. Crude Oil was sharply higher.  China has been buying even with the port closures and domestic difficulties. The Russian invasion of Ukraine continued and shipments of Crude Oil and products from Russia are interrupted. That means higher Crude Oil prices and higher polyester prices for the world. The ongoing peace talks between the two sides are making slow progress much to the cheer of the rest of the world. Traders are worried about Chinese demand moving forward.  China has closed two ports for imports due to Covid and is also closing down a number of cities as the Covid spreads through the nation. However, Shanghai said it would stay open and asked office workers to follow a hybrid model used here in the US. The US Dollar has been moving higher in the past week due to the war and the stock market has worked lower. Short-term trends are still sideways.

Overnight News: The Delta and Southeast will get scattered showers and above normal temperatures. Texas will have mostly dry conditions and below normal temperatures. The USDA average price is now 124.57 ct/lb.  ICE said that certified stocks are now 537 bales, from 537 bales yesterday.

Chart Trends: Trends in Cotton are up with objectives of 138.00 May. Support is at 12710, 12510, and 12330 May, with a resistance of 13240, 13360, and 13480 May.

FCOJ

General Comments: FCOJ was a little higher yesterday as most commodities markets rallied and on lower US production estimates and less FCOJ in storage. The weather remains generally good for production around the world. Brazil has some rain and conditions are rated very good. Weather conditions in Florida are rated mostly good for the crops with a couple of showers and warm temperatures. Mexican crop conditions in central and southern areas are called good with rains. Northern and western Mexico is rated in good condition. Florida Mutual said that FCOJ inventories are now 30% less than last year in its latest Movement and Pack report.

Overnight News: Florida should get isolated showers. Temperatures will average above normal. Brazil should get scattered showers and near-normal temperatures.

Chart Trends: Trends in FCOJ are up with objectives of 152.00, 154.00, and 165.00 May. Support is at 143.00, 141.00, and 140.00 May, with resistance at 151.00, 154.00, and 156.00 May.

Coffee

General Comments: New York and London were higher as a lack of deliveries from Brazil and Indonesia supported the futures market. The Russian invasion of Ukraine continued and caused a lot of concern about demand for Coffee in the world in the future. Good growing conditions for the next crop in Brazil were also noted as a reason to sell. Coffee prices have been negatively affected, but most other agricultural futures are higher to sharply higher due to the war. The logistical and production problems in Brazil are still around. The dry weather and then the freeze in Brazil have created a lot of problems for the trees to form cherries this year. Containers are not available in Brazil to ship the Coffee.

Overnight News: ICE-certified stocks are higher today at 1.111 million bags. The ICO daily average price is now 193.70 ct/lb. Brazil will get isolated showers with near to above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE NY said that 33 contracts were tendered against delivery of March contracts and those total deliveries for the month are now 1,353 contracts.

Chart Trends: Trends in New York are mixed up with objectives of 228.00, 237.00, and 247.00 May. Support is at 219.00, 210.00, and 207.00 May, and resistance is at 228.00, 231.00, and 236.00 May. Trends in London are up with objectives of 2300 May. Support is at 2120, 2110, and 2060 May, and resistance is at 2200, 2220, and 2260 May.

Sugar

General Comments: New York and London were higher last week in reaction to the Russian invasion of Ukraine and the potential for the west to cut off Crude Oil exports from Russia. Crude Oil was sharply higher yesterday.  Current peace talks between Russia and Ukraine are yielding at most slow progress and that kept Crude Oil supported. President Biden indicated a couple of weeks ago that Russian energy imports would be curtailed due to the war. The daily charts show that price trends are up for both markets. News reports indicate that little export activity is taking place from Ukraine or Russia with the Black Sea and Azov Sea ports basically closed. Some of the oil giants have pulled operations out of Russia in response to the war, but others are still working there.

Overnight News: Brazil will get isolated showers. Temperatures should average near to above normal.

Chart Trends: Trends in New York are up with objectives of 1950 and 2000 May. Support is at 1900, 1850, and 1840 May and resistance is at 1950, 1990, and 2020 May. Trends in London are up with objectives of 563.00 May.  Support is at 540.00, 537.00, and 525.00 May and resistance is at 554.00, 560.00, and 566.00 May.

Cocoa

General Comments: New York and London closed lower yesterday as the weather is improving in West Africa. Some showers are in the forecast for West Africa and have been for a couple of weeks. Chart trends remain down on improved crop conditions and in part because of demand fears as Europe is the leading per capita consumer of Chocolate and demand could drop if the war in Ukraine expands or even if it doesn’t. Demand fears have eased a bit as both sides in the conflict report slow progress at peace talks, but progress has been made. The weather is generally too dry for West Africa and good in Southeast Asia. The dry conditions in West Africa are now disappearing due to scattered showers in the region. Ideas are that demand will only improve slightly if at all and production in West Africa appears to be good this year.

Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near to 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 4.724 million bags.

Chart Trends: Trends in New York are mixed. Support is at 2490, 2450, and 2400 May, with resistance at 2560, 2610, and 2650 May. Trends in London are mixed.  Support is at 1670, 1650, and 1640 May, with resistance at 1720, 1740, and 1760 May.