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COTTON   

General Comments: Cotton rallied to close much higher on Friday, but still was lower for the week as traders continued to worry about a fallout from the failure of Congress to reach a new debt limit ceiling.  Failure to agree on a new debt ceiling increase could push the US and world economies into recession and hurt Cotton demand, but there were signs that the situation could be resolved on Friday to provoke the rally.  Also noted good and improving growing conditions and average planting progress for the US crop.  Forecasts for showers are still showing in forecasts for West Texas to Oklahoma and Kansas and are expected to be beneficial.  Ideas are that the world economic problems were fading into the background as the US stock market has held strong and as the Chinese economy gets better after all of the Covid lockdowns.

Overnight News:  The Delta will get mostly dry conditions and near to above normal temperatures.  The Southeast will see isolated showers and near to above normal temperatures.  Texas will have scattered showers and near normal temperatures.  The USDA average price is now 79.42 ct/lb.  ICE daily certified stocks are now 63 bales, from 63 bales yesterday.

Chart Trends:  Trends in Cotton are mixed.  Support is at 81.40, 79.90, and 79.50 July, with resistance of 84.00, 84.90 and 85.60 July.

COT — Supplemental Report – Option and Futures Combined Positions as of May 23, 2023

FCOJ

General Comments: FCOJ closed higher last week and trends are up on the daily and weekly charts. Futures remain supported by very short Oranges production estimates for Florida.  Historically low estimates of production due in part to the hurricanes and in part to the greening disease that have hurt production, but conditions are significantly better now with scattered showers and moderate temperatures.  The weather remains generally good for production around the world for the next crop including production areas in Florida that have been impacted in a big way by the two storms seen previously in the state.  Brazil has some rain and conditions are rated good.

Overnight News:  Florida should get isolated showers.  Temperatures will average near normal. Brazil should get mostly dry conditions and near to above normal temperatures.

Chart Trends:  Trends in FCOJ are up with objectives of 301.00 July.  Support is at 280.00, 270.00, and 260.00 July, with resistance at 299.00, 305.00, and 311.00 July.
Disaggregated Commitments of Traders- Options and Futures Combined Positions as of May 23, 2023

COFFEE

General Comments:  New York closed lower and London closed higher on Friday, but both markets were lower for the week as the US Dollar rallied in the face of the US debt ceiling increase negotiations.  It now appears that there will be a resolution that will not make the far left or the far right very happy.  Short term trends are still turning down in New York amid good Brazilian weather outlooks.  There are reports of good rains and dry weather mixed in for Arabica production in Brazil with high production expectations.  The Arabica harvest has started and offers of Arabica from Brazil are expected to increase in the short term.  There are still tight Robusta supplies for the market amid strong demand for Robusta, but the Brazil harvest is in the market now and is expected to take some of the demand.  Producers in Vietnam and Indonesia are said to have almost nothing left to sell and producers in Colombia and Brazil are also reported to be short Coffee to sell.  The market really needs big offers from Brazil to sustain any down side movement.

Overnight News:  ICE certified stocks are lower today at 0.598 million bags.  The ICO daily average price is now 172.84 ct/lb.  Brazil will get mostly dry conditions with near to above normal temperatures.  Central America will get mostly dry conditions.  Vietnam will see scattered showers.

Chart Trends:  Trends in New York are mixed to down with objectives of 180.00, 176.00, and 165.00 July.  Support is at 18000, 177.00, and 174.00 July, and resistance is at 187.00, 190.00 and 194.00 July.  Trends in London are mixed to up with objectives of 2720 July. Support is at 2530, 2500, and 2460 July, and resistance is at 2670, 2710, and 2740 July.

COT — Supplemental Report – Option and Futures Combined Positions as of May 23, 2023

SUGAR  

General Comments: Both New York and London closed higher on Friday, but lower for the week, and trends are down for the short term in New York.  Trends are mixed in London.  Unica estimated that Sugar production increased greatly in the first half of May to help the market think that supply shortages might come to an end for at least the time being soon.  It said that the first half May crush was 44 million tons, up 28% from last year.  Mills produced 2.5 million tons of Sugar, up 50% from last year, and 1.9 billion liters of ethanol, up 15% from last year.  The market is still hurt by good growing and harvesting conditions in Brazil but supported by tight current supplies. The production is not there to meet the demand in many countries, with only Brazil among the major producers looking to have a good crop.  Indian production is less this year as mills are closing early there and Pakistan also has reduced production.  Thailand mills are also closing earlier than expected so the crop there might be less.  Asian countries could face another year of short production as El Nino returns after years of La Nina.  European production is expected to be reduced again this year.  Chinese production could be the lowest in six years due to bad growing conditions.  The ISO said that a sharp reduction for its projection for a global sugar supply surplus in 2022/23 is 850,000 tons from the 4.15 million tons seen in its previous quarterly report in February.  The cut was partly driven by downward revisions to production in India (32.8 million tons from 34.3 million) and Thailand (11.0 million tons from 12.3 million), though the ISO said the focus has now shifted to top exporter Brazil.

Overnight News: Brazil will get mostly dry conditions.  Temperatures should average near to above normal.  India will get mostly dry conditions and below normal temperatures.

Chart Trends: Trends in New York are mixed to down with objectives of 2470 and 2420 July.  Support is at 2460, 2360, and 2300 July and resistance is at 2550, 2620, and 2680 July.  Trends in London are mixed.  Support is at 692.00, 682.00, and 676.00 August and resistance is at 715.00, 735.00, and 743.00 August.

COT — Supplemental Report – Option and Futures Combined Positions as of May 23, 2023

COCOA

General Comments: New York and London closed lower last week as the market consolidates just below spike highs set in the last few weeks.  Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast continue, but certified stocks are increasing in New York.  The lack of arrivals from West Africa to ports is still important and is supporting futures, but certified stocks have increased a lot this week in New York and deliveries have picked up as well.  Talk is that hot and dry conditions reported earlier in Ivory Coast could curtail main crop production, and main crop production ideas are not strong.  Midcrop production ideas are strong due to rain mixed with some sun recently reported in Cocoa areas of the country.  Cocoa arrivals at ports in Ivory Coast had reached 2.030 million tons by May 21 since the start of the season on Oct. 1, down 5.7% from the same period last season.

Overnight News: Isolated showers are forecast for West Africa.  Temperatures will be near normal.  Malaysia and Indonesia should see scattered showers.  Temperatures should average near normal.  Brazil will get isolated showers and near to above normal temperatures.  ICE certified stocks are lower today at 5.718 million bags.

Chart Trends: Trends in New York are mixed.  Support is at 2990, 2970, and 2950 July, with resistance at 3080, 3100, and 3130 July.  Trends in London are mixed to up with no objectives.  Support is at 2350, 2300, and 2270 July, with resistance at 2410, 2440, and 2470 July.

COT — Supplemental Report – Option and Futures Combined Positions as of May 23, 2023

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