Softs Report - Tuesday, Nov. 29

COTTON
General Comments: Cotton was lower yesterday as demand has not been real strong so far this year. Demand has not improved with the reduction in prices and a lower US Dollar to date. China had been making some initial moves to open its economy and country again but many cities remain in lockdown due to an increase in Covid infections. China saw anti government protests over the weekend due to its polices an the economic turmoil they have created. The protests were sparked by the deaths of several apartment dwellers in a city that protesters said was locked and on lockdown status.. There are hopes that China is about to open again despite its zero tolerance Covid policies. However, Covid has surged there and the government might need to postpone or delay the moves to open the country again. Production in the US is very short. The trade is still worried about demand moving forward due to recession fears and Chinese lockdowns but is also worried about total US production potential. It is possible that the continued Chinese lockdowns will continue to hurt demand for imported Cotton for that country and that a weaker economy will hurt demand from the rest of the world.
Overnight News: The Delta and Southeast will get mostly dry conditions and near to above normal temperatures. Texas will have mostly dry conditions and near to above normal temperatures. The USDA average price is now 77.91 ct/lb. ICE said that certified stocks are now 8,901 bales, from 8,901 bales yesterday. ICE NY said that 0 notices were posted for delivery against December futures and that total deliveries for the month are now 5 contracts.
Chart Trends: Trends in Cotton are down with objectives of 7650 and 6920 March. Support is at 77.20, 75.50, and 74.60 March, with resistance of 80.30, 83.50 and 86.00 March.

brown plant field

Photo by Amber Martin on Unsplash

FCOJ
General Comments: FCOJ was lower yesterday on what appeared to be speculative selling tied to profit taking and perhaps on worries about inflation. Inflation is a double edged sword as the prices for pills will also be increasing. Historically low estimates of production due in part to the hurricanes and in part to the greening disease has hurt production remain in place. The weather remains generally good for production around the world for the next crop but not for production areas in Florida that have been impacted in a big way by the two storms. Brazil has some rain and conditions are rated good. Mostly dry conditions are in the forecast for the coming days.
Overnight News: Florida should get isolated showers or moaatly dry conditions. Temperatures will average near to above normal. Brazil should get scattered showers and near to above normal temperatures.
Chart Trends: Trends in FCOJ are mixed to up with objectives of 213.00 and 222.00 January. Support is at 203.00, 199.00, and 195.00 January, with resistance at 212.00, 219.00, and 222.00 January.

COFFEE
General Comments: New York closed lower and London closed higher on news of much improved growing conditions for Coffee this year in Brazil but on reports of too much rain in Vietnam affecting the harvest progress. The move came with the US Dollar Index moving lower last week. Weather conditions are good in Brazil and the rest of Latin America and supplies available to the market should keep increasing and the market is looking forward to the increased supplies. Ideas are that the market will have more than enough Coffee when the next harvest comes in a few months. Ideas of a significant recovery in world production next year remains the main cause for any selling More showers and rains are in the forecast in Brazil Coffee areas for this week. The rest of South America and Central America are reported to be in good condition. Vietnam has scattered showers in Coffee areas.
Overnight News: ICE certified stocks are higher today at 0.565 million bags. The ICO daily average price is now 155.16 ct/lb. Brazil will get scattered showers with near normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE said that 0 contracts were tendered for delivery against December futures and that total deliveries for the month are now 264 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 170.00 and 178.00 March. Support is at 159.00, 154.00, and 151.00 March, and resistance is at 169.00, 174.00 and 177.00 March. Trends in London are mixed. Support is at 1840, 1820, and 1790 January, and resistance is at 1880, 1900, and 1910 January.

SUGAR
General Comments: New York and London closed lower yesterday on worries about Chinese demand after anti government protests there over the weekend revolving around Covid lockdowns, and trends are turning down in both markets. It looks like the futures are starting to anticipate an increase in supplies available to the market and offers should increase more from Brazil and India. The weather in Brazil remains good for the next crop. More ideas that supplies of White Sugar would soon be increasing for the market has weighed on prices for the London market. World Sugar market is expected to be in a big surplus production next year. The supply is starting to increase. Brazil Sugar offers are increasing on ideas of unprofitable Ethanol prices coming to the country and reports of increased use of Corn for Ethanol production Indian exporters continue selling into the world market.
Overnight News: Brazil will get scattered showers. Temperatures should average near normal. India will get mostly dry conditions and near to above normal temperatures.
Chart Trends: Trends in New York are down with objectives of 1880, 1790, and 1720 March. Support is at 1890, 1880, and 1850 March and resistance is at 1940, 1980, and 2010 March. Trends in London are mixed to down with objectives of 491.00, 481.00, and 475.00 March. Support is at 524.00, 520.00, and 512.00 March and resistance is at 538.00, 543.00, and 550.00 March.

COCOA
General Comments: New York closed lower and London closed higher yesterday in currency related trading. Trends are mixed in both markets for the holidays but both show the chance to work higher in the next few weeks. Ivory Coast arrivals appear to have improved lately with the recent rally in futures prices. Ivory coast arrivals re now 718,000 tons, up 1.1% from last year. Good production is reported and traders are worried about the world economy moving forward and how that could affect demand. Supplies of Cocoa are as large as they will be now for the rest of the marketing year. Reports of scattered showers along with very good soil moisture from showers keep big production ideas alive in Ivory Coast. The weather is good in Southeast Asia.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see scattered showers. Temperatures should average above normal. Brazil will get scattered showers and near to above normal temperatures. ICE certified stocks are higher today at 5.509 million bags. ICE NY said that 652 contracts were posted for delivery against December futures and that total deliveries for the month are now 1568 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 2520 and 2570 March. Support is at 2440, 2420, and 2400 March, with resistance at 2500, 2520, and 2560 March. Trends in London are mixed to up with objectives of 2040 and 2120 March. Support is at 1960, 1930, and 1880 March, with resistance at 2000, 2020, and 2060 March.


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