COTTON
General Comments: Futures were higher once again on demand hopes. Demand has been strong even with the Coronavirus around and getting worse. The overall weaker US Dollar has helped demand ideas as well although the Dollar has started to firm recently. The US stock market has been generally firm to help support ideas of a better economy here and potentially increased demand for Cotton products. Production was rated as less in the most recent USDA production reports so supplies could turn tight if the demand remains strong. Talk is around regarding the planted area for the next crop. Producers in Texas might decide to plant Sorghum instead of Cotton due to the relatively strong prices in Sorghum. Chinese demand for Sorghum has been very strong to cause the higher prices.
Overnight News: The Delta will get mostly isolated showers and below normal temperatures and Southeast will get mostly dry conditions and near normal temperatures. Texas will have scattered showers and much below temperatures. The USDA average price is now 85.41 ct/lb. ICE said that certified stocks are now 100,326 bales, from 100,326 bales yesterday. USDA said that net weekly Upland Cotton export sales were 119,500 bales this year and 2,100 bales next year. Net Pima export sales were 14,600 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed to up with no objectives. Support is at 8710, 8670, and 8450 March, with resistance of 8960, 9020 and 9080 March.
DJ On-Call Cotton – Feb 18
As of Feb 12. On-call positions represent spot cotton sold to or
purchased from a merchant, based on New York cotton futures contracts
of 500-pound bales. Prices are not yet fixed against these contracts.
Source: CFTC
*-denotes changes from the previous week are based on revised data from
last week.
Call Previous Change Call Previous Change
Sales Purchases
Mar 21 6,490 13,509 -7,019 3,111 5,633 -2,522
May 21 31,116 28,212 2,904 4,798 4,075 723
Jul 21 36,174 36,395 -221 6,057 6,170 -113
Oct 21 0 0 0 0 0 0
Dec 21 15,646 14,498 1,148 18,408 18,514 -106
Mar 22 5,087 5,066 21 1,641 1,573 68
May 22 1,625 1,475 150 612 362 250
Jul 22 5,096 4,796 300 1,575 1,581 -6
Dec 22 1,419 1,419 0 4,608 3,423 1,185
Mar 23 26 26 0 0 0 0
May 23 18 18 0 0 0 0
Jul 23 18 18 0 220 220 0
Dec 23 0 0 0 227 227 0
May 24 0 0 0 441 441 0
Total 102,715 105,432 -2,717 41,698 42,219 -521
Open Open Change
Int Int
Mar 21 17,517 69,043 -51,526
May 21 113,551 87,328 26,223
Jul 21 55,322 47,329 7,993
Oct 21 17 15 2
Dec 21 49,272 39,332 9,940
Mar 22 6,083 5,623 460
May 22 1,106 777 329
Jul 22 2,452 2,304 148
Dec 22 2,607 2,370 237
Mar 23 0 0 0
May 23 0 0 0
Jul 23 1 1 0
Dec 23 0 0 0
May 24 0 0 0
Total 247,928 254,122 -6,194
DJ USDA FORUM: U.S. Cotton Outlook – Feb 19
Arlington, Va. (Dow Jones)–Data from 2021 USDA Agricultural Outlook Forum, February 19, 2021.
U.S. Cotton Area, Yield, and Production
2020/21 and 2021/22 proj.
(million bales)
2020/21 2021/22 Change
Planted area mil. acres 12.09 12.00 -0.7
Harvested area mil. acres 8.70 10.00 14.9
Abandonment rate % 28.0 16.7 -11.3
Yield/harvested acre lbs./acre 825 840 1.8
Production mil. bales 14.95 17.50 17.1
2020/21 2021/22 Change
Percent
Beginning Stocks mil. bales 7.3 4.3 -40.7
Area Harvested mil. HA 3.5 4.0 14.7
Production mil. bales 15.0 17.5 17.0
Imports mil. bales 0.0 0.0 0.0
Total Supply mil. bales 22.2 21.8 -1.8
Exports mil. bales 15.5 15.5 0.0
Use mil. bales 2.4 2.5 4.2
Total Use mil. bales 17.9 18.0 0.6
Ending Stocks mil. bales 4.3 3.8 -11.6
Stock to Use % % 24.0 21.1 -12.1
Farm Price cents/lb. 68.0 75.0 10.3
DJ USDA FORUM: World Cotton Balance Sheet – Feb 19
ARLINGTON, Va. (Dow Jones)– Data from 2021 USDA Agricultural Outlook forum, February 19, 2021
World Cotton Balance Sheet World Cotton Supply and Demand
2020/21 est. and 2021/22 proj.
2020/21 2021/22 Change
Mln Bales Mln Bales Percent
Beginning Stocks 91.2 88.1 -3.4
Area Harvested mil. HA 32.3 33.2 2.9
Production 114.1 119.5 4.7
Imports 43.9 43.9 0.1
Total Supply 205.3 207.6 1.1
Exports 43.9 43.9 0.1
Use 117.2 122.0 4.1
Total Use 117.3 122.0 4.0
Ending Stocks 95.7 93.2 -2.6
Stock to Use% 81.7 76.4 -6.4
China Cotton Balance Sheet China Cotton Supply and Demand
2020/21 est. and 2021/22 proj.
2020/21 2021/22 Change
Mln Bales Mln Bales Percent
Beginning Stocks 36.9 37.3 1.0
Area Harvested mil. HA 3.3 3.2 -0.8
Production 29.0 27.5 -5.2
Imports 11.0 11.0 0.0
Total Supply 76.9 75.8 -1.5
Exports 0.1 0.1 0.0
Use ” 39.5 40.5 2.5
Total Use 39.6 40.6 2.5
Ending Stocks 37.3 35.1 -5.7
State Reserve 12.3 11.7 -4.9
Stock to Use% 93.8 86.2 -8.0
FCOJ
General Comments: FCOJ closed lower as the cold weather might have damaged production potential in Texas and Mexico is already part of the price. Some damage to leaves and open flowers was possible, but ideas are that the overall damage was minor. Trends are trying to turn up on the daily and weekly charts. Freezing temperatures were reported in Florida last week but were not cold enough for a long enough time to damage any crops. Temperatures are more moderate this week. The weather in Florida is good with a few showers to promote good tree health and fruit formation. Showers are falling in Brazil now and crop conditions are called good. Mexican crop conditions otherwise are called good with rains, but earlier dry weather might have hurt production.
Overnight News: Florida should get scattered showers. Temperatures will average near to above normal. Brazil should get isolated showers and near to above normal temperatures.
Chart Trends: Trends in FCOJ are mixed to down with objectives of 106.00 and 101.00 March. Support is at 109.00, 108.00, and 103.00 March, with resistance at 112.00, 115.00, and 117.00 March.
COFFEE
General Comments: Futures were higher once again in New York on ideas of less offer from Brazil and higher in London as Vietnam producers stopped selling during the Tet holiday. Tet is now over but selling is slow to resume. There are reports of good weather in Vietnam for the harvest. Indonesia has had good weather but has little coffee to sell now. Brazil has been dry for flowering and initial fruit development and it has been warm and dry in recent times. Rains are now falling that could be very beneficial. Vietnam has harvested its production under mostly dry conditions. Central America is also drier for harvesting. Good growing conditions are reported in Colombia and Peru. The demand from coffee shops and other food service operations is still at very low levels. Reports indicate that consumers at home are consuming blends with more Robusta and less Arabica.
Overnight News: ICE certified stocks are lower today at 1.736 million bags. The ICO daily average price is now 119.33 ct/lb. Brazil will get scattered showers with near normal temperatures. Central America will get scattered showers or dry conditions. Vietnam will see mostly dry conditions. ICE said that 12 notices were posted for delivery against March contracts and that total deliveries for the month are now 118 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 134.00 and 141.00 May. Support is at 126.00, 124.00, and 121.00 May, and resistance is at 131.00, 134.00 and 137.00 May. Trends in London are mixed to up with objectives of 1400 and 1430 May. Support is at 1370, 1350, and 1320 May, and resistance is at 1400, 1420, and 1430 May.
SUGAR
General Comments: New York and London closed higher and both markets made new highs for the move and new contract highs. Ideas of increased demand are still around as traditional buyers have been active. Rains were reported again in Brazil. It has been raining in south central Brazil and the production of cane is over for the season. Production has been hurt due to dry weather earlier in the year. India is producing less Sugar and more Ethanol. Thailand might have less this year due to reduced planted area and erratic rains during the monsoon season. The EU Sugar crop is less this year as is the crop in Russia.
Overnight News: Brazil will get scattered showers. Temperatures should average near normal.
Chart Trends: Trends in New York are up with objectives of 1770 and 1830 May. Support is at 1610, 1580, and 1560 May, and resistance is at 1660, 1690, and 1720 May. Trends in London are up with objectives of 480.00 May. Support is at 461.00, 458.00, and 451.00 May, and resistance is at 476.00, 482.00, and 48.00 May.
DJ USDA FORUM: U.S. Sugar Supply And Use – Feb 19
ARLINGTON, Va. (Dow Jones)–Data from 2021 USDA Agricultural Outlook Forum,
February 19, 2021.
2019/20 2020/21 2021/22
Jan Feb Projections
1,000 short tons, raw value
Beginning Stocks 1,783 1,618 1,618 1,993
Production 2/ 8,149 9,156 9,312 9,399
Beet Sugar 4,351 4,992 5,046 5,154
Cane Sugar 3,798 4,163 4,265 4,245
Florida 2,106 2,135 2,200 2,150
Hawaii – – – –
Louisiana 1,566 1,886 1,931 1,945
Texas 126 142 134 150
Imports 4,235 3,344 3,404 2,728
TRQ 3/ 2,152 1,721 1,721 1,597
Other Program 4/ 432 350 350 350
Other 5/ 1,651 1,273 1,333 781
Mexico 1,376 1,163 1,163 735
Total Supply 14,166 14,117 14,333 14,119
Exports 61 35 35 35
Deliveries 12,414 12,305 12,305 12,405
Food 12,316 12,200 12,200 12,300
Other 6/ 98 105 105 105
Miscellaneous 74 – –
Total Use 12,549 12,340 12,340 12,440
Ending Stocks 1,618 1,777 1,993 1,679
Stocks to Use Ratio 12.9 14.4 16.1 13.5
1/ Fiscal years beginning Oct 1. Historical data are from USDA’s “Sweetener Market
Data” report. 2/ Production projections for 2020/21 and 2021/22 are based on Crop
Production and/or processor projections/industry data and/or sugar ICEC analysis
where appropriate. 3/ For 2020/21, WTO raw sugar TRQ shortfall (99) and for 2021/22
(99). 4/ Composed of sugar under the re-export and polyhydric alcohol programs. 5/
Imports from Mexico; and high-tier tariff sugar and syrups not otherwise specified —
for 2019/20 (275), 2020/21 (170), and 2021/22(46). 6/ Transfers to sugar-containing
products for re-export and for livestock feed and nonedible alcohol/ethanol.
COCOA
General Comments: New York and London closed lower on ideas of big supplies available to the market. The ICCO said that the Cocoa surplus would be about 100,000 tons this year. Chart trends are turning down. There were reports of demand for Cocoa in Ivory Coast, although the reports noted that there is a lot to sell there. The grind data has been weaker again implying less demand for chocolate. Ivory Coast has not been shipping as exporters have asked to hold off. There are ideas of big supplies at origin. Wire reports this morning say that Ivory Coast has abandoned its tax scheme and instead is offering a discount to get Cocoa moving again.
Overnight News: Mostly dry conditions 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 lower today at 3.540 million bags. ICE said that 61 contracts were delivered against March futures and that total deliveries for the month are now 62 contracts.
Chart Trends: Trends in New York are mixed to down with objectives at 2240 and 2060 May. Support is at 2370, 2250, and 2200 May, with resistance at 2430, 2460, and 2480 May. Trends in London are mixed to down with objectives of 1580 and 1520 May. Support is at 1620, 1610, and 1580 May, with resistance at 1640, 1660, and 1680 May.
Ivory Coast Raises Cocoa Main-Crop Forecast to 1.65 Million Tons
2021-02-18 13:50:09.930 GMT
Questions? Ask Jack Scoville today at 312-264-4322
