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Morning Softs. 08/08/17

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General Comments: Cotton was mostly higher on follow through buying worries about growing conditions in Texas and the southwest and also in other world production areas along with good export demand. December was slightly lower. After the close, USDA showed mixed conditions, with some crops showing improvement and other crops showing deterioration. The progress remains a little behind the five-year average. Futures trends are up. The temperatures are more moderate in Texas and there have been some showers. The growing weather in the US Delta and Southeast is generally good as rains have been seen in many growing areas. Monsoon rains are reported as verify uneven in India and Pakistan and some flooding has been reported in the Gujarat of India. Some central areas and eastern areas have missed rains. Some crops are lost in the worst hit areas of the northwest parts of India due to flooding. China is reporting improved production conditions as rains have improved in growing areas. It has been too hot and dry in Turkey and production losses are possible.
Overnight News: The Delta and Southeast will see scattered showers this week. Temperatures should average near to below normal. Texas will see scattered showers on today and about Thursday. Temperatures will average near to below normal. The USDA average price is now 68.41 ct/lb. ICE certified stocks are now 22,977 bales, from 24,596 bales yesterday.
Chart Trends: Trends in Cotton are up with objectives of 7110 and 7380 December. Support is at 7020, 6970, and 6900 December, with resistance of 7160, 7220, and 7250 December.

Crop Progress
Date 6-Aug 30-Jul 2016 Avg
Cotton Squaring 93 87 95 96
Cotton Setting Bolls 58 46 68 68
Cotton Bolls Opening 8 9 7
Crop Condition
Very Poor Fair Good Very Good
Cotton This Week 6 8 29 41 16
Cotton Last Week 5 9 30 43 13
Cotton Last Year 3 13 36 40 8

General Comments: FCOJ closed a little lower again yesterday as the market sheds some weather premium. Florida weather is very good as rains are reported each day and as no hurricanes have yet formed in the Atlantic. There are no systems in the Atlantic to cause concern about tropical storm development that could be detrimental to trees and fruit. One System is forming, but will not move to Florida and maybe not any part of the US as it appears headed to Mexico. The busiest part of the hurricane season is coming in the next few weeks, so more storms can nd probably will form. The demand side remains weak and there are plenty of supplies in the US. Brazil has been exporting FCOJ to the US to cover the short Florida crop. Domestic production remains very low due to the greening disease and the drought early in the growing season. Trees now are showing fruit of varying sizes and overall conditions are now called good as big rains have been seen in the last few weeks. Brazil crops remain in mostly good condition.
Overnight News: Florida should get mostly dry conditions and near to above normal temperatures. Brazil should get mostly dry conditions and near to below normal temperatures.
Chart Trends: Trends in FCOJ are mixed. Support is at 132.00, 130.00, and 128.00 September, with resistance at 139.00, 142.00, and 145.00 September.

General Comments: New York and London closed higher yesterday on speculative buying. They bought on ideas of smaller offers from Brazil and the rest of Latin America. The potential for reduced Arabica production and the possibility of reduced exports from Brazil has become the driver for the market as trends have turned up. The weather forecasts kept outlooks for near to above normal temperatures and mostly dry conditions in Brazil. Producers are still worried about an extended outbreak of dry weather as it is almost flowering time in Brazil. Reports of Broca worm moving into Brazil crops is bringing ideas of additional losses. The harvest in Brazil is starting to wind down. Reports indicate that the quality of the beans harvested in Brazil is not good and that many beans are small. The cash market is quiet with little interest from producers or roasters. Chart trends are up in New York.
Overnight News: Certified stocks are slightly lower today and are about 1.563 million bags. The ICO composite price is now 133.05 ct/lb. Brazil will get mostly dry weather. Temperatures should average near to above normal. Colombia should get scattered to isolated showers. Central America and southern Mexico should get scattered showers, with big storms today in southern Mexico. Temperatures should average near to above normal.
Chart Trends: Trends in New York are up with objectives of 150.00 September. Support is at 135.00, 133.00, and 134.72 September, and resistance is at 142.00, 145.00 and 148.00 September. Trends in London are mixed to up with objectives of 2210 and 2320 September. Support is at 2130, 2100, and 2090 September, and resistance is at 2160, 2170, and 2180 September.

General Comments: Futures in London and New York were lower Follow through selling is possible today. The market faded at some big resistance areas last week and is now liquidating. The charts show that futures remain in an overall trading range, and the range should probably hold. That suggests that buying interest could increase again if the market moves just a little lower. The big harvest in Brazil continues, but some of the processing will probably switch now to ethanol due to tax changes this week. The harvest pace has been below last year until now, but is now above a year ago. Production potential in India and Thailand seems improved for now as monsoon rains have been better than last year. It is raining in much of India now as the monsoon is active, but rains have been uneven. Some northwest areas have been flooded due to big rains. Other areas are too dry and there could be some damage to crops if more rains do not show up fairly soon. Thailand is getting rains. The rest of Southeast Asia is seeing average to above average rains so far this year. Some problems are being reported in Europe and Russia for the beet Sugar production.
Overnight News: Brazil will get mostly dry conditions. Temperatures should average near to above normal.
Chart Trends: Trends in New York are mixed to up with objectives of 1540 and 1660 October. Support is at 1390, 1370, and 1320 October, and resistance is at 1480, 1510, and 1530 October. Trends in London are mixed. Support is at 385.00, 380.00, and 377.00 October, and resistance is at 398.00, 407.00, and 410.00 October.

General Comments: Futures were higher in range trading. The market faded at some big resistance areas last week and is now liquidating. The charts show that futures remain in an overall trading range, and the range should probably hold. That suggests that buying interest could increase again if the market moves just a little lower. Not much has changed fundamentally, although it is becoming warmer and drier in Ivory Coast. The rest of West Africa is still getting showers and more moderate temperatures. Chocolate manufacturers in general have reported improved sales volumes and ideas are that the better sales can continue as chocolate and cocoa are relatively cheap. Ivory Coast is expected to have a big crop starting harvest this Fall, but it should be smaller than last year. Ghana also expects a good crop this year The offer side of their market appears to be less right now as West Africa is between crops. The growing conditions in other parts of the world are generally good. East African conditions are now called good. Brazil remains too dry. Good conditions are still seen in Southeast Asia.
Overnight News: Scattered showers and storms are expected in West Africa. Temperatures will average near to above normal. Malaysia and Indonesia should see scattered showers in all areas. Temperatures should average near to above normal. Brazil will get mostly dry conditions or light showers and near to above normal temperatures. ICE certified stocks are lower today at 5.294 million bags.
Chart Trends: Trends in New York are mixed. Support is at 1990, 1940, and 1900 September, with resistance at 2040, 2070, and 2090 September. Trends in London are mixed. Support is at 1560, 1530, and 1470 September, with resistance at 1600, 1610, and 1620 September.

Ivory Coast Oct-Dec cocoa output seen down 20-25 pct -CCC sources – Reuters News
08-Aug-2017 08:27:52 AM
ABIDJAN, Aug 8 (Reuters) – Ivory Coast expects a 20 to 25 percent drop in its cocoa output in the first three months of the season from October to December, two sources at the marketing board said on Tuesday.
The world’s leading cocoa growing produced 937,764 tonnes of cocoa in October to December in 2016, CCC data shows. The full cocoa season runs from October to September.
The CCC sources also said Ivory Coast will end forward sales of its 2017/18 cocoa crop in August, a month earlier than originally planned, and limit total volumes auctioned to 1.25 million tonnes. The sources said Ivory Coast had already sold 1.205 million tonnes in forward contracts.
(Reporting by Ange Aboa; writing by Tim Cocks; editing by Jason Neely)

Ivorian cocoa arrivals at 1,899,857 T by July 31 – CCC data – Reuters News
08-Aug-2017 07:19:47 AM
ABIDJAN, Aug 8 (Reuters) – Cocoa arrivals at ports in top grower Ivory Coast reached 1,899,857 tonnes by July 31, since the start of the season on Oct. 1, up from 1,435,145 tonnes in the same period of the previous season, official data showed on Tuesday.
Exporters had estimated arrivals at around 1,951,000 tonnes by July 30, but the figure from the Coffee and Cocoa Council (CCC) came in lower after some rejections owing to bad quality, a result of flooding in cocoa growing regions in July that affected thousand farms, a CCC source said.
(Reporting by Ange Aboa; Editing by Tim Cocks)

Ivory Coast cocoa grinders process 433,000 T of beans Oct-July – Reuters News
08-Aug-2017 08:31:52 AM
ABIDJAN, Aug 8 (Reuters) – Ivory Coast cocoa grinders processed 433,000 tonnes of beans between the beginning of the season in October and the end of July, up from 376,000 tonnes over the same period last year, data from exporters’ association GEPEX showed on Tuesday.
In July, grinders processed 44,000 tonnes of beans, up from 34,000 tonnes in June 2016, the data showed.
(Reporting By Ange Aboa, Editing by Edward McAllister and Susan Fenton)
Questions? Ask Jack Scoville today at 312-264-4322

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About the author

Jack Scoville is a futures market analyst specializing in grains, softs, rice, oilseeds, and tropical products such as coffee and sugar.

He offers brokerage services to an international clientele of agricultural producers, processors, exporters, and other professional traders.

Jack writes daily comments of the many products he specializes in, in three languages, English, Spanish, and Portuguese.

He has been quoted by most major wire services including Dow Jones, AP, and Reuters. His comments have also appeared in newspapers around the world and on various radio and television shows.

Jack offers a dedicated and high quality service for his clients. His industry contacts in South America, Europe, Asia, and North America provide him with a unique view of the markets. He also uses his own charting program for technical traders.

Jack began working in the futures industry over 30 years ago and spent 10 years working on the floor of the Chicago Board of Trade in various roles. He has been a broker off the floor since then and has been with The PRICE Futures Group since it was established in 1988.

Contact Jack Scoville: (800) 769-7021 or at

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