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Morning Softs Report 01/12/18

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General Comments: Cotton was sharply higher to limit up in response to a week of very strong export sales and reports of increased mil buying that appeared after prices held support areas on the charts. The market is expecting USDA to show bullish US and world data and knows that buyers in the cash market still have to buy a lot of futures contracts to fix prices for the on call Cotton. Trends are up in front of the USDA reports that will be released later today. Price Group expects few changes to US production estimates as the Cotton production appears to have held well. USDA can show increased export demand and slightly smaller ending stocks, although overall supplies should still be big. However, the hurricanes and the freeze appear to have really damaged quality and the quality losses have forced mills and exporters to pay up for better quality Cotton. Producers remain limited sellers at best.
Overnight News: The Delta and the Southeast will get precipitation today, then dry conditions. Temperatures should be below normal. Texas will see mostly dry conditions. Temperatures will be on both sides of normal. The USDA average price is now 79.96 ct/lb. ICE said that certified stocks are now 47,942 bales, from 47,942 bales yesterday.
Chart Trends: Trends in Cotton are up with no  objectives. Support is at 8160, 8000, and 7940 March, with resistance of 8280, 8400, and 8460 March.

DJ Still-Stout Demand Sends Wool to Fresh Record — Market Talk
0601 GMT – Australian wool prices opened at new record highs after a 3-week holiday hiatus, yet Australia Wool Innovation says demand for available wool is strong. There’s growing demand on the consumer side, and “limited global stocks to be put through machines leaves many optimistic about immediate prospects of Australian wool.” the farm group adds. The Eastern Market Indicator, the global benchmark for wool prices, rose 3.3% to A$18.18/kilogram. (

DJ On-Call Cotton – Jan 11
As of Jan 5. 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 18 46,623 50,426 -3,803 6,963 7,454 -491
May 18 33,406 31,880 1,526 1,262 1,391 -129
Jul 18 35,460 33,592 1,868 2,577 2,573 4
Oct 18 0 0 0 0 0 0
Dec 18 20,532 19,743 789 9,791 9,616 175
Mar 19 9,960 9,379 581 643 577 66
May 19 2,938 2,412 526 10 10 0
Jul 19 3,450 3,207 243 617 617 0
Dec 19 2,740 2,558 182 5,737 5,712 25
Mar 20 1,273 1,091 182 146 146 0
Total 156,382 154,288 2,094 27,746 28,096 -350
Open Change
Mar 18 172,818 175,374 -2,556
May 18 55,146 54,078 1,068
Jul 18 22,741 19,469 3,272
Oct 18 1 1 0
Dec 18 32,711 31,799 912
Mar 19 1,451 670 781
May 19 55 57 -2
Jul 19 394 381 13
Dec 19 1,002 860 142
Mar 20 0 0 0
Total 286,319 282,689 3,630

Wire: Bloomberg News (BN) Date: Jan 9 2018 12:15:00
Cotton Production, Inventory Survey Before USDA WASDE Report
By Dominic Carey
(Bloomberg) — The following table shows results of a Bloomberg News survey
of as many as eight analysts for the USDA’s World Agricultural Supply and Demand
report on the 2017-18 cotton crop, which is scheduled for release at noon in
Washington on Jan. 12. Figures are in millions of bales.
|——Survey Results——–|USDA
2017-18:| Avg | Low | High | Dec. | 2016-17
US Production | 21.36| 20.80| 21.60| 21.44| 17.17
US Exports | 15.11| 14.50| 15.75| 14.80| 14.92
US End Stocks | 5.51| 4.91| 6.06| 5.80| 2.75
World | | | | |
Production | 118.90| 116.00| 120.20| 119.96| 106.56
World | | | | |
Consumption | 119.51| 118.60| 120.00| 119.59| 114.77
World End | | | | |
Stocks | 87.29| 86.00| 88.50| 88.00| 87.65
Analyst |————U.S.————|——World—-
| | | End
Estimates: |Production |Exports |Stocks |Production |Consumption |Stocks
================================================================================ | 21.60| 15.60| 5.00| 116.00| 120.00| 86.00
Doane | 21.50| 15.70| 5.00| 118.50| 120.00| 86.00
Love Consulting | 21.51| 15.00| 5.92| 120.20| 119.75| 88.20
Price Futures Group| 20.80| 15.00| 5.50| n/a | n/a | n/a
Rabobank | 21.10| 14.50| 5.80| 119.00| 119.50| 87.10
Rose Consulting | 21.56| 14.80| 6.06| 119.88| 119.50| 88.05
Varner Bros. | 21.50| 15.75| 4.91| 119.20| 118.60| 87.20
Wedbush Securities | 21.30| 14.50| 5.90| 119.50| 119.25| 88.50
SOURCE: Bloomberg News
To contact the reporter on this story:
Dominic Carey in Washington at
To contact the editors responsible for this story:
Alex Tanzi at
Kristy Scheuble
Copyright (c) 2018, Bloomberg, L. P.
################################ END OF STORY 1 ##############################

General Comments: FCOJ closed mixed and prices remain in a trading range as the market prepares for the next round of USDA production reports. The reports will be released later today. Trade expectations for the report are hard to find. The current weather is good as temperatures are warm and there is little rain around, but the crop is small anyway, and the charts still show that a potential short-term bottom has formed. USDA could curt its production estimates a little bit again. The harvest is progressing well and fruit is being delivered to processors and the fresh fruit packers. Trees in Florida that are still alive now are showing fruit of good sizes, although many have lost a lot of the fruit. Florida producers are actively harvesting and performing maintenance on land and trees. Processors mostly getting field run fruit.
Overnight News: Florida should get mostly dry weather and above normal temperatures. Brazil should get scattered showers and near to above normal temperatures. ICE said that no January deliveries were posted yesterday and that total deliveries for the month are now 2 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 134.00, 132.00, and 131.00 March, with resistance at 138.00, 140.00, and 141.00 March.

Wire: Bloomberg News (BN) Date: Jan 9 2018 12:20:00
Florida Orange Production Survey Before USDA’s Citrus Report
By Dominic Carey
(Bloomberg) — The following table shows results of a
Bloomberg News survey of three analysts about the 2017-18
Florida orange crop. The USDA will release their estimate at
noon in Washington on Jan. 12. Figures are in millions of 90-lb
Summary of Results: | Output
Survey Avg | 45.7
Survey Range | 40-52
USDA Dec. Estimate | 46.0
USDA 2016-17 Crop | 68.75
Analyst Estimates: |
Price Futures Group | 45.0 | 52.0
Infinity Trading | 40.0
SOURCE: Bloomberg News
To contact the reporter on this story:
Dominic Carey in Washington at
To contact the editors responsible for this story:
Alex Tanzi at
Kristy Scheuble
Copyright (c) 2018, Bloomberg, L. P.
################################ END OF STORY 1 ##############################

General Comments: Futures were lower in New York and near unchanged in London yesterday. Speculators were said to be the best sellers in New York and appear to be adding to short positions. Ideas of big production potential for Brazil, Honduras, and Vietnam are around and are the major topics of conversation. The cash market seemed mostly quiet due to the recent price weakness, but traders say that a lot of Coffee is being sold and moved out of Honduras. Bid and offer spreads in the rest of Central America appear to be wide. Ideas are that Vietnam also has a lot of Coffee to sell, but farmers are holding back and hoping for stronger prices leading into the Tet holiday. Internal prices in Vietnam remain at high levels compared to London, and the Price spread has helped keep London in a sideways range. There is plenty of rain in some areas of Brazil this week, and producers in much of Minas Gerais expect good crops There are reports of short crops in parts of Central America and some areas in South America due to the lack of farmer investment from the low prices, but Honduras has production and has been selling as much as possible, and ideas of bigger crops this year in Honduras and Vietnam are offsetting reports of smaller crops in the rest of Central America and Colombia.
Overnight News: Certified stocks are higher today and are about 2.005 million bags. The ICO composite price is now 114.31 ct/lb. Brazil will get light showers each day with best amounts and coverage expected over te weekend. Temperatures should be near to above normal. Colombia should get isolated showers. Central America and southern Mexico should get isolated showers or dry conditions. Temperatures should average near to above normal.
Chart Trends: Trends in New York are mixed to down with objectives of 121.00 and 116.00 March. Support is at 122.00, 120.00, and 118.00 March, and resistance is at 126.00, 138.00 and 130.00 March. Trends in London are mixed. Support is at 1700, 1670, and 1650 March, and resistance is at 1740, 1760, and 1770 March.

General Comments: Futures were lower in both New York and London again yesterday and trends are down on the daily charts for both markets. Speculators were the best sellers on ideas that the upside potential in prices was limited and that supplies of Sugar into the world market are ample.Production surplus estimates for the year range from about 4.0 million tons to above 10.4 million tons. Much of the support has come from the recent rally in energy prices. The Crude Oil market is firm and could help keep sugar prices high if more cane gets diverted into ethanol production. But, the market still anticipates that there will be plenty of Sugar to meet any demand.
Overnight News: Brazil should feature light showers each day. Temperatures should be near to above normal
Chart Trends: Trends in New York are down with objectives of 1410, 1370, and 1260 March. Support is at 1390, 1360, and 1350 March, and resistance is at 1450, 1480, and 1500 March. Trends in London are down with objectives of 367.00 March. Support is at 367.00, 365.00, and 361.00 March, and resistance is at 383.00, 385.00, and 392.00 March.

DJ Brazil Center-South Sugar Crush Down 18.1% in 2nd Half of December
By Jeffrey T. Lewis
SAO PAULO–Brazilian sugar mills in the country’s center-south region crushed less cane in the second half of December compared with a year earlier, according to industry group Unica.
Center-south mills crushed 2.6 million metric tons of cane in the period, a decrease of 18.1% from the same period a year earlier. They produced 111,000 tons of sugar, down 15.6%, and made 189 million liters of ethanol, an increase of 12.3%.
The production mix for the second half of last month was 31.25% sugar to 68.75% ethanol. A year earlier, the mix was 35.3% sugar and 64.7% ethanol.
Brazil is the world’s biggest sugar producer and exporter, and the center-south grows about 90% of the country’s cane.
In the season from April 1 through Jan. 1, mills in the region crushed 583.4 million tons of cane, down 1.5% from the same period a year earlier. Sugar production rose 1.7% to 35.8 million tons, and ethanol output rose 1.2% to 25.2 billion liters.
The production mix for the season through Jan. 1 was 46.9% sugar to 53.1% ethanol. A year earlier, the mix was 46.6% sugar and 53.4% ethanol.

General Comments: Futures closed lower and prices are back near the middle of the trading range. New York still appears to be putting a bottom together. London could also be in the process of completing a bottom. The West African main harvest has started to wind down and focus is shifting to the next round of grind data and the weather for the West African midcrop. Ideas are that Cocoa demand from grinders can be strong this quarter due to the weaker prices. The market is also on alert for the Harmattan winds that can suck moisture from the soil and trees and really hurt bean quality and production. These winds have not developed as of yet, but could at any time. Arrivals in West Africa remain behind year ago levels when they were expected to be above year ago levels. Prices are weak overall due to the ongoing harvest, but have found some good buying interest at current levels as some are now viewing the market as cheap. World supply ideas remain high.
Overnight News: Mostly dry conditions are expected in West Africa. Temperatures will average above normal. Malaysia and Indonesia should see frequent showers. Temperatures should average above normal. Brazil will get cry conditions and near to above normal temperatures. ICE certified stocks are higher today at 3.607 million bags.
Chart Trends: Trends in New York are mixed. Support is at 1900, 1870, and 1850 March, with resistance at 1960, 2000, and 2030 March. Trends in London are mixed. Support is at 1370, 1330, and 1320 March, with resistance at 1450, 1460, and 1500 March.
Questions? Ask Jack Scoville today at 312-264-4322

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The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures. The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author. Trading in futures contracts, options on futures contracts, and forward contracts is not suitable for all investors and involves substantial risks. ©2018

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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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