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COTTON       

General Comments:  Futures were lower in Turnaround Tuesday trading and trends remain mostly up in this market.  The overall fundamentals remain positive for prices.  USDA cut production and ending stocks levels in its latest reports and the demand has held together well.  The weekly export sales report on Friday showed strong demand for US Cotton once again, and the demand has been strong even with the Coronavirus around and getting worse.  The overall weaker US Dollar has helped demand ideas as well.

Overnight News:  The Delta and Southeast will get scattered showers early this week.  Temperatures should average near normal.  Texas will have mostly dry conditions or isolated showers and variable temperatures.  The USDA average price is now 77.78 ct/lb.  ICE said that certified stocks are now 77,059 bales, from 73,984 bales yesterday.

Chart Trends:  Trends in Cotton are mixed.  Support is at 8110, 8060, and 8030 March, with resistance of 8260, 8300 and 8340 March.

FCOJ 

General Comments:  FCOJ closed higher after making new lows for the move.  Traders were looking at an oversold condition on the charts and bought.  The weather in Florida remains good for the crops and the harvest is active.  The Coronavirus is still promoting consumption of FCOJ at home.  Restaurant and food service demand has been much less as no one is dining out.  The weather in Florida is good with frequent showers to promote good tree health and fruit formation.  Brazil has been too dry and irrigation is being used.  Showers are falling in Brazil now.  Mexican crop conditions are called good with rains.

Overnight News:  Florida should get mostly dry conditions.  Temperatures will average near to above normal.   Brazil should get scattered showers and near to above normal temperatures.   ICE said that 0 notices were posted for delivery against January contracts today and that total deliveries for the month are now 0 contracts.

Chart Trends:  Trends in FCOJ are down with objectives of 110.00 March.  Support is at 113.00, 110.00, and 107.00 March, with resistance at 120.00, 122.00, and 125.00 March.

COFFEE   

General Comments:  Futures were higher in New York and London as the Brazilian Real rallied.  Reports of good weather in Brazil and Vietnam and on the potential for increased exports from Vietnam were negative, but the rains in Brazil are falling away from Coffee areas this week.  Brazil has been dry for flowering and initial fruit development.  Vietnam has harvested its production under mostly dry conditions.  Some of those crops are starting to hit the market as farmers sell before the Tet holiday.  Central America is also drier for harvesting.  The demand from coffee shops and other food service operations is still at very low levels as consumers are still drinking Coffee at home.  Reports indicate that consumers at home are consuming blends with more Robusta and less Arabica.  The weather is good in Colombia and Peru.

Overnight News:  ICE certified stocks are higher today at 1.609 million bags.  The ICO daily average price is now 116.50 ct/lb.  Brazil will get isolated showers with near to above normal temperatures.  Central America will get scattered showers or dry conditions.  Vietnam will see mostly dry conditions.

Chart Trends:  Trends in New York are mixed.  Support is at 122.00, 119.00, and 116.00 March, and resistance is at 127.00, 129.00 and 130.00 March.  Trends in London are mixed.   Support is at 1300, 1260, and 1240 March, and resistance is at 1330, 1360, and 1390 March.

SUGAR                 

General Comments:  New York and London closed lower, with both markets starting new down trends on the daily charts.  Rains were reported again in Brazil and ideas are that the production of cane is increasing with the rains.  It has been raining in south central Brazil.  The rains have come late to the region but they are supporting whatever crops are still in the ground now.  Production has been hurt due to dry weather earlier in the year.  India has a very big crop of Sugarcane this year but no exports are coming out as the government has been very slow to approve export subsidies.  Thailand might have less this year due to reduced planted area and erratic rains during the monsoon season.  The EU is having problems with its Sugarbeets crop due to weather and disease.  Coronavirus has returned to the world and has caused some demand concerns, especially for Ethanol.  China has been a strong buyer but ideas are that is has done its buying for the year.

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

Chart Trends: Trends in New York are mixed to down with objectives of 1420 and 1070 March.  Support is at 1540, 1510, and 1470 March, and resistance is at 1610, 1630, and 1670 March.  Trends in London are mixed to down with objectives of 453.00, 415.00, and 381.00 March.  Support is at 439.00, 433.00, and 425.00 March, and resistance is at 450.00, 455.00, and 460.00 March.

DJ Brazil Sugar Crush Up 66.6% in 1H January After Harvest Ends 

By Jeffrey T. Lewis

SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed more cane in the first half of January compared with a year earlier after the cane harvesting season reached its end.

Center-south mills crushed 213,000 metric tons of cane in the period, an increase of 66.6% from the same period a year earlier, according to industry group Unica. They produced 7,570 tons of sugar, up 77.2%, and made 124.8 million liters of ethanol, an increase of 30.5%.

With the closure of most mills in the region, which produces about 90% of Brazil’s sugar cane, the output numbers can swing wildly in either direction because the amounts produced are tiny compared with the height of the harvest season.

Output of sugar in the closing season jumped compared with a year earlier because of good prices for the sweetener on global markets and because of a decline in demand for fuels, including ethanol, during the coronavirus pandemic.

The production mix for the first half of January was 32.1% sugar to 67.9% ethanol, compared with 24.7% sugar and 75.3% ethanol in the same period a year ago.

In the season from April 1 through Jan. 16, mills in the region crushed 597.6 million tons of cane, up 3.2% from the same period a year earlier. Sugar production rose 44.2% to 38.2 million tons, and ethanol output fell 8.8% to 29.4 billion liters.

The production mix for the season through Jan. 16 was 46.2% sugar to 53.8% ethanol, compared with 34.5% sugar and 65.5% ethanol in the same period a year ago.

COCOA                

General Comments:  New York and London closed higher and are showing mixed trends on the charts.  Arrivals to ports in Ivory Coast have been slow.  The grind data has been weaker again implying less demand for chocolate.  Importers are still looking for ways to source Cocoa without paying a premium demanded by Ivory Coast and Ghana.  Both countries have instituted a living wage for producers there and are looking to tax exports to pay the increased wages.  Buyers have been accused of using certified stocks from the exchange instead of buying from origin.  Origin has ample supplies to sell right now.  There are a lot of demand worries as the Coronavirus is making a comeback in the US.  Europe is also seeing a return of the pandemic.  The next grind data is due out over the next couple of weeks.  Ivory Coast has not been shipping as exporters have asked to hold off.  There is about 100,000 tons ready to ship with no buyers at this time.

Overnight News:  Mostly dry conditions are forecast for West Africa.  Temperatures will be near 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 lower today at 3.210 million bags.

Chart Trends:  Trends in New York are mixed.  Support is at 2480, 2460, and 2440 March, with resistance at 2630, 2650, and 2660 March.  Trends in London are mixed.  Support is at 1710, 1690, and 1660 March, with resistance at 1750, 1780, and 1820 March.

Questions? Ask Jack Scoville today at 312-264-4322
 
 
 
 

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