- Coffee Prices Hit New Lows
90 looks to be coming
- Softs Report 03/22/19
COTTON General Comments: Cotton was higher on big fund buying as May futures moved once again above 76.00 and this time was able to [...]
- Cotton (CT) Breaks 9 Month Downchannel Resistance
Cotton (CT) surged more than 2% yesterday as it broke above a 9 month downchannel resistance (on the weekly chart). CT is due for some healthy profittaking...
- Lean Hogs June 2019
Highly Accurate Multi Time Frame Technical Analysis
- Softs Report 03/21/19
COTTON General Comments: Cotton was a little lower in consolidation trading. Everyone is waiting for the resolution of the US-China trade dispute, and...
- Mooses in the Markets - Technicals Show Weakness and Supply, Demand Seesaw Continues - Cocoa Futures
During Wednesdays trading session, May cocoa attempted to break some key support levels.
Futures Market News and Commentary
Cotton futures saw losses of 6 to 60 points in the front months on Friday, pressured by a stronger dollar and lower crude oil. May was up 1.43% this week. The Cotlook A Index was UNCH on March 21 to 84.65 cents/lb. The USDA Adjusted World Price (AWP) was updated to 65.83 cents/ lb on Thursday, up 173 points from the week prior. The weekly Commitment of Traders report showed spec funds trimming their net short position as of March 19 by 9,189 contracts to 10,818 contracts in cotton futures and options. US export commitments for upland cotton are now 13.1% below the same time last year. In comparison to the USDA projected total, they are 89% complete, with the average pace at 90% for this date.May 19 Cotton closed at 76.580, down 60 points,Jul 19 Cotton closed at 77.570, down 46 pointsOct 19 Cotton closed at 75.860, down 6 points --provided by Brugler Marketing & Management
May NY world sugar #11 (SBK19) on Friday closed up +0.07 (+0.56%) and May ICE London white sugar (SWK19) closed up +0.20 (+0.06%). May NY sugar rebounded from a 1-week low Friday and May London sugar recovered from a 2-1/2 month low and closed higher on expectations that India's sugar exports may be less than government estimates. The Indian Sugar Mills Association (ISMA) sees India 2018/19 sugar exports at 3.0-3.5 MMT, below the government's quota of 5 MMT as sugar mills close for the season. The ISMA reported Friday that 85 India sugar mills in the state of Maharashtra, India's second-largest sugar producing region, have closed as of March 15 versus 38 mills that closed a year earlier, and that 56 sugar mills closed by March 15 in Karnataka, India's third-biggest sugar-producing region, versus 48 mills that closed a year earlier. Gains in sugar prices were limited Friday by the slide in the Brazilian real to a 2-week low against the dollar, which encourages exports by Brazil's sugar producers. Also, weakness in crude prices is another negative for sugar prices. Lower crude oil prices undercut ethanol prices and may prompt Brazil’s sugar mills to divert more cane crushing to sugar production than ethanol production, thus boosting sugar supplies. Sugar prices continue to see negative carry-over from Tuesday's news that the All India Sugar Trade Association raised its 2018/19 sugar production estimate for India, now the world's largest sugar producer, to 32.6 MMT from a Jan estimate of 31.5 MMT and above the Indian Sugar Mills Association's estimate of 30.7 MMT. Also, India's Sugar Mills Association on Monday reported that India sugar production during Oct 1-Mar 15 rose +5.9% y/y to 27.35 MMT.Big Picture Sugar Market Factors: Bullish factors for sugar include (1) concern about smaller global production after Unica forecasted that Brazil's Center South 2018/19 sugar production will fall -28% y/y to 26 MMT, (2) increased demand from Indonesia, the world's largest sugar importer, after Indonesia's Sugar Refiners Association said refiners may import 3.2 MMT of raw sugar in 2019, up +5.3% y/y, and (3) stronger demand for Brazil's ethanol after Unica reported Brazil millers sold 1.72 billion liters of hydrous ethanol in the domestic market in Feb, up +47% y/y and a record volume for a February, which implies less Brazilian sugar production. Bearish factors include (1) ISO's forecast that global 2018/19 sugar production will rise +0.6% y/y to a record 185.2 MMT and that there will be a 2018/19 sugar surplus of 2.2 MMT (vs 2017/18's 7.3 MMT), (2) USDA's FAS forecast for 2018/19 sugar production in India, the world's second-largest sugar producer, to climb +5.3% y/y to a record 35.9 MMT, and (3) record sugar output from Thailand, the world's fourth-largest sugar producer, after the Thailand Office of Cane and Sugar Board reported that Thailand 2017/18 sugar production rose to a record 14.47 MMT.
May ICE NY cocoa (CCK19) on Friday closed up +27 (+1.27%) and May ICE London cocoa (CAK19) closed up +8 (+0.49%). Cocoa prices on Friday consolidated recent losses. May NY cocoa fell to a 3-1/2 month low Thursday and May London cocoa posted a 1-1/2 month low on ample global supplies and forecasts for beneficial rain in West Africa at the end of this week. Also, satellite imagery from the U.S. Climate Prediction Center showed that there was above-average rainfall during March 10-16 across most of Ghana, the world's second-biggest cocoa producer, although rain was mixed in the Ivory Coast. Another bearish factor is strong cocoa production in the Ivory Coast, the world's biggest cocoa producer, after data on Monday showed that Ivory Coast farmers sent 1.586 MMT of cocoa to ports during Oct 1-Mar 17, up +10.9% from the same time last year. Current cocoa supplies are abundant as cocoa stockpiles held at ICE-monitored warehouses rose to a 5-3/4 month high Monday of 4.269 mln bags.Big Picture Cocoa Market Factors: Bullish factors for cocoa include (1) the forecast by Radiant Solutions that "mid-crop growth will be minimal" for cocoa crops as weather conditions throughout the Ivory Coast and Ghana have been somewhat dry, and (2) strong cocoa demand in Asia after the Singapore Cocoa Association reported that Asia Q4 cocoa grindings unexpectedly rose +6.3% y/y to 208,900 and as Asia 2018 full-year cocoa grindings rose +7.8% y/y to 780,956 MT, the highest since data began in 2011. Bearish factors for cocoa include (1) ICCO's projection that the 2018/19 global cocoa surplus will widen to +39,000 MT from +9,000 MT in 2017/18, (2) the projection from Barry Callebaut, the world's biggest cocoa processor, that global supply may match demand in 2019 amid robust global cocoa output, and (3) signs of tepid demand after the National Confectioners Association reported North American Q4 cocoa processing rose by only +1.2% to 117,526 MT and the European Cocoa Association reported that Q4 European cocoa grindings rose by only +1.6% y/y to 359,103 MT.
May arabica coffee (KCK19) on Friday closed down -0.90 (-0.95%) and May ICE robusta coffee (RMK19) closed down -9 (-0.60%). May arabica coffee slumped to a new contract low Friday and May robusta held just above the March 15 contract low on ample coffee supplies and rain in Brazil. Researcher Cepea on Wednesday projected Brazil 2018/19 coffee exports will climb to a record 40 mln bags. Also, weakness in the Brazilian real against the dollar Friday weighed on coffee prices as the real dropped to a 2-week low against the dollar. A weaker real encourages exports from Brazil's coffee producers. Current supplies are abundant as ICE-monitored coffee inventories climbed to a 4-1/2 year high of 2.5 mln bags on Tuesday and CeCafe reported last Wednesday that Brazil Feb arabica coffee exports jumped +40.5% y/y to 3.1 mln bags. In addition, abundant rainfall in Brazil is benefiting Brazil's coffee crops after data from Somar Meteorologia on Monday showed that rainfall in Minas Gerais, Brazil's largest arabica coffee growing region, measured 56.8 mm in the past week, or 131% of the historical average. A positive factor for coffee was last Friday's data from the Green Coffee Association that showed U.S. Feb green coffee inventories fell -4% y/y to 6.26 mln bags. A positive factor for robusta coffee is smaller robusta supply after recent data from Vietnam's Department of Customs showed that Vietnam Jan-Feb coffee exports fell -10.1% y/y to 317,148 MT.Big Picture Coffee Market Factors: Bullish factors for coffee include (1) projections from Conab, Brazil's official government forecasting agency, that Brazil 2019/20 coffee production will fall -18% y/y to 50.5 mln bags as the crop moves into the lower-yielding half of a 2-year cycle, and (2) USDA projections that global 2018/19 coffee consumption will climb +2.9% to a record 163.219 mln bags. Bearish factors include (1) researcher Cepea's projection that Brazil 2018/19 coffee exports will climb to a record 40 mln bags, (2) ample supplies as ICO data showed that global 2018/19 coffee exports Oct-Jan rose +6.6% y/y at 41.96 mln bags, (3) ICO's forecast for a global 2018/19 coffee surplus of 2.29 mln bags and its projection that a second year of surplus will depress coffee prices over the next few months, (4) heavy coffee supply as ICE-monitored coffee inventories climbed to a 4-1/2 year high of 2.5 mln bags, and (5) USDA projections for global 2018/19 coffee production to climb +7.1% y/y to a record 171.166 mln bags and for global 2018/19 coffee ending stocks to increase by +11.6% to a 3-year high of 32.812 mln bags.