COTTON

General Comments: Futures were a little lower as Hurricane Nicholas came on shore near Houston and threatened to bring some big rains to Cotton production areas in the Delta and Southeast. More bolls are open now so there is a better chance for damage to or loss of fiber. 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. A weaker US Dollar yesterday helped demand ideas. However, the expansion of the Delta variant has given pause to the better demand ideas due to fears of economies here and around the world starting to partially lockdown again. Production ideas are being impacted in just about all areas due to the weather extremes. It has been very hot in parts of Texas and the Delta and Southeast have had drenching rains at various times in the last couple of months. Even so, good US production totals are expected.

Overnight News: The Delta will get isolated showers with some big rains possible in the south and near-normal temperatures and the Southeast will get isolated to scattered showers and near to above normal temperatures. Texas will have isolated showers or dry conditions and above normal temperatures. The USDA average price is now 90.85 ct/lb. ICE said that certified stocks are now 63,515 bales, from 63,515 bales yesterday. USDA said that net Upland Cotton export sales were 284,800 bales this year and 0 bales next year. Net Pima sales were 9,600 bales this year and 0 bales next year.

Chart Trends: Trends in Cotton are mixed. Support is at 9250, 9200, and 9180 December, with a resistance of 9510, 9600, and 9670 December.

FCOJ

General Comments: FCOJ closed higher yesterday on weather concerns, especially for Brazil but also for Florida and Mexico. Futures broke through recent highs and trends are turning up in this market. A freeze hit Sao Paulo state several weeks ago and reports of significant losses are being heard. Weather conditions in Florida are rated mostly good for the crops with scattered showers and near-normal temperatures. 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 above normal temperatures. ICE said that 0 notices were posted for delivery against September contracts and that total deliveries for the month are now 0 contracts.

Chart Trends: Trends in FCOJ are mixed to up with objectives of 152.00 and 161.00 November. Support is at 139.00, 135.00, and 130.00 November, with resistance at 146.00, 149.00, and 150.00 November.

Image Source: Pixabay

COFFEE

General Comments: New York and London closed higher yesterday on tight supplies available for export from origin. New York was reacting once again to the lack of Coffee available in Brazil after recent extreme weather events. London is having trouble sourcing Coffee from Vietnam due to a shortage of containers to carry the Coffee out of the country. The expansion of the Delta variant has caused so many problems around the world and is really affecting the Vietnamese. Vietnamese exports were down 8.7% in August and are down 6.4% for the calendar year. Prices in New York have been firm as the current Brazil harvest starts to wind down with smaller production but have been weaker since the freeze event. The damage from the Brazil freeze several weeks ago is apparent. Some trees were killed and will have to be replaced. Dry weather and warm temperatures are reported now. Scattered showers are now in the forecast for Southeast Asia. Good conditions are reported in northern South America and good conditions are 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 Africa.

Overnight News: ICE-certified stocks are slightly lower today at 2.161 million bags. GCA stocks are now 6.130 million bags, from 6.074 million last month. The ICO daily average price is now 168.78 ct/lb. Brazil will get mostly dry conditions with above normal temperatures. Central America will get scattered showers. Vietnam will see scattered showers. ICE NY said that 0 contracts were tendered for delivery against September futures and that total deliveries for the month are now 1,047 contracts.

Chart Trends: Trends in New York are mixed. Support is at 182.00, 178.00, and 176.00 December, and resistance is at 191.00, 194.00, and 201.00 December. Trends in London are mixed up with objectives of 2110, 2150, and 2170 November. Support is at 2060, 2030, and 1200 November, and resistance is at 2100, 2120, and 2150 November.

DJ Uganda Coffee Exports Rose 35% in August as Plantations Matured
By Nicholas Bariyo

KAMPALA Uganda–Coffee exports from Uganda rose 35% on the year in August, extending a rising streak into the closing months of the 2020-21 season, as maturing plantations and favorable weather boost yields across Africa’s top exporter of the beans, the state-run coffee Development Authority said Thursday.

Exports jumped to 700,990 60-kilogram bags, up from the 519,683 bags exported in the same month last season. August’s shipments brought the cumulative 11-month exports for the season to 5.9 million bags, a 22% jump compared with last season. Shipments have been rising over the past seven months, signaling the success of Uganda’s coffee-growing campaign as the country continues efforts to increase annual coffee production to 20 million bags by 2025.

Increased coffee prices on the international market, triggered by fears of severe weather in Brazil and supply disruption caused by a shortage of containers and coronavirus restrictions in Vietnam, have prompted most Ugandan farmers to release more stocks to the market, boosting exports, UCDA said.

Harvesting in the central and western robusta growing regions is closing to pave way for the harvest in the eastern arabica coffee-producing regions.

SUGAR

General Comments: New York and London were both higher yesterday and the trends are turning up. Futures were led higher by the September contract and there is talk of a squeeze developing as both markets move to September expiration. The reduced production potential from Brazil is still impacting the market. That idea is not seen in the latest UNICA data that showed a slightly greater percentage of Sugarcane processed for Ethanol than Sugar in the latest two week period. The ISO has noted that this will be the second year of deficit production for the world, in large part because of the Brazil freeze that cut production. Consumption of Sugar remains on the light side. Fears that the Covid is returning and could reduce economic activity and demand are around. Thailand is expecting improved production.

Overnight News: Brazil will get mostly dry conditions. Temperatures should average above normal.

Chart Trends: Trends in New York are mixed to up with objectives of 2040, 2090, and 2210 March. Support is at 1970, 1930, and 1920 March, and resistance is at 2050, 2090, and 2120 March. Trends in London are up with objectives of 526.00 December. Support is at 508.00, 504.00, and 502.00 December, and resistance is at 520.00, 526.00, and 532.00 December.

COCOA

General Comments: New York and London closed higher again yesterday and trends are turning up once again. Ivory Coast has stopped selling for the next crop on fears of less supplies. World economies are starting to reopen after Covid and the open economies are giving demand the boost. The weather has had below-normal rains in West Africa and crop conditions are rated good for now but there is concern about the lack of rain. Drier weather will be beneficial for the harvest which will be underway soon. Some are forecasting less production in the coming year. Ivory Coast sources told wire services that the country has sold between 1.64 million and 1.66 million tons of Cocoa so far this season. This is considered a very big amount and there are concerns about Cocoa availability at origin moving forward. Cocoa arrivals in Ivory Coast are now 2.142 million tons, up 4.8% from last year.

Overnight News: Isolated to scattered 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 5.534 million bags. ICE said that 148 contracts were posted for delivery against September futures and that total deliveries for the month are now 1,705 contracts.

Chart Trends: Trends in New York are mixed to up with objectives of 2780 December. Support is at 2650, 2600, and 2570 December, with resistance at 2710, 2740, and 2770 December. Trends in London are mixed. Support is at 1800, 1780, and 1740 December, with resistance at 1840, 1850, and 1900 December.