Softs Report 11/16/18

COTTON
General Comments Cotton was a little lower after trading both sides of unchanged. Speculators were on both sides of the market as farmers continued to work on harvesting. Reports indicate good harvest conditions in most areas. Cash market conditions remain weak, and ICE certified stocks have been increasing in the last couple of weeks at a rapid rate. USDA showed that bolls are finally about open and that harvest is still moving a bit slower than average. The market needs new demand. Export sales for the last few weeks have been poor and show no real signs of improvement for now. Export demand needs to improve soon for prices to rally significantly this year, but any increase in demand has to come with no purchases from China for a while. India is getting all of the Chinese Business and prices there are much stronger.
Overnight News: The Delta should get mostly dry weather and cool temperatures. Some rain is possible on Sunday. The Southeast will get dry weather. Temperatures should trend to near to below normal. Texas will have mostly dry weather. Temperatures will be variable. The USDA average price is now 72.54 ct/lb. ICE said that certified stocks are now 111,532 bales, from 106,083 bales yesterday. USDA said that net Upland Cotton export sales were 67,600 bales this year and 45,900 bales next year. Net Pima sales were 16,200 bales this year and 0 bales next year.
Chart Trends: Trends in Cotton are mixed to down with objectives of 7600 and 7500 December. Support is at 7570, 7540, and 7500 December, with resistance of 7680, 7730, and 7830 December.

DJ On-Call Cotton – Nov 15
As of Nov 9. 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
Dec 18 14,125 18,131 -4,006 13,848 15,193 -1,345
Mar 19 42,838 39,331 3,507 7,139 5,330 1,809
May 19 20,272 19,795 477 901 947 -46
Jul 19 29,693 29,609 84 2,086 2,140 -54
Dec 19 16,391 16,604 -213 17,451 17,780 -329
Mar 20 5,437 5,437 0 275 209 66
May 20 2,100 2,100 0 0 0 0
Jul 20 1,872 1,872 0 0 0 0
Dec 20 1,166 1,166 0 2,500 2,500 0
Total 133,894 134,045 -151 44,200 44,099 101
Open Change
Int
Dec 18 64,729 116,433 -51,704
Mar 19 111,355 87,111 24,244
May 19 29,041 20,220 8,821
Jul 19 14,701 12,855 1,846
Oct 19 4 4 0
Dec 19 29,092 27,996 1,096
Mar 20 938 970 -32
May 20 88 68 20
Jul 20 33 33 0
Dec 20 834 825 9
Total 250,815 266,515 -15,700

FCOJ
General Comments: FCOJ was a little lower again yesterday. Futures made new lows for the move. The price action yesterday implies that even lower prices are coming. The Oranges harvest is active in Florida under good weather conditions. The fruit is abundant, but small. Chart trends are down. Overall growing conditions in Florida are good to very good, and there is no storm development in the Atlantic at this time. Florida producers are seeing small sized to good sized fruit, and work in groves maintenance is active. Irrigation is being used in all areas. Packing houses are open to process fruit for the fresh market, and a couple of major processors are open in the state to take packing house eliminations.
Overnight News: Florida should get mostly dry conditions or light showers. Temperatures will average near to above normal. Brazil should get scattered showers and near to above normal temperatures. ICE said that 0 contracts were delivered against November futures and that total deliveries for the month are now 352 contracts.
Chart Trends: Trends in FCOJ are down with objectives of 130.00 and 126.00 January. Support is at 133.00, 130.00, and 127.00 January, with resistance at 136.00, 138.00, and 139.00 January.

COFFEE
General Comments: Futures were lower in New York and slightly higher in London. Currency relationships, and especially the rate between the US Dollar and the Brazilian Real, continue to be a driving force in Coffee trading, nd a higher Real against the Dollar encourages farmers and mills to hold back on sales. There was little other news from Brazil. The weather there appears good right now. The Brazil crops are getting harvested now, but producers are not selling much. Producers are also looking ahead to next year. El Nino remains in the forecast and Coffee areas in Brazil could be affected by drought. This is the off-year for production there, anyway, and a drought would mean even less production. Vietnam is getting close to its next harvest. Production in Vietnam is estimated at or above 30 million bags. Some problems with too much rain have been noted in Central America. Drier conditions are wanted for harvesting, and mostly dry weather is in the forecast.
Overnight News: Certified stocks are higher today and are about 2.459 million bags. The ICO composite price is now 108.42 ct/lb. Brazil will get chances for showers. Temperatures should be near to above normal. Colombia should get isolated showers. Central America and southern Mexico should get showers or dry conditions. Vietnam will get showers.
Chart Trends: Trends in New York are down with objectives of 101.00 December. Support is at 110.00, 108.00, and 105.00 December, and resistance is at 114.00, 116.00 and 118.00 December. Trends in London are mixed to down with objectives of 1640 January. Support is at 1640, 1620, and 1610 January, and resistance is at 1690, 1710, and 1730 January.

SUGAR
General Comments: Futures closed about unchanged in New York and lower in London. Ideas for world Sugarcane and Sugar beets production continue to work a little lower. Production losses are expected in India due to hot and dry weather earlier in the growing season and some recent reports of pest attacks. Industry sources noted less production and said that India will most likely have trouble meeting its export goals this year that range as high as 5 to 6 million tons. They will export, but not that much. Dry conditions continue in the EU, and Russia, but conditions are mostly good in Ukraine. Very good conditions are reported in Thailand. Brazil producers are worried about Cane production, and the market still talks about less production there this year. It was dry earlier, but most areas have had enough or too much rain now. The wet areas are mostly in the center-south region. The dry weather in much of Europe and in southern Russia near the Black Sea has hurt Sugar beets production potential in these areas.
Overnight News: Brazil will get showers. Temperatures should be near to above normal.
Chart Trends: Trends in New York are mixed to down with objectives of 1230 March. Support is at 1260, 1230, and 1210 March, and resistance is at 1290, 1320, and 1350 March. Trends in London are mixed to down with no objectives. Support is at 343.00, 338.00, and 336.00 March, and resistance is at 347.00, 353.00, and 355.00 March.

COCOA
General Comments Futures closed a little higher in both markets. Word of dry weather in most of West Africa was considered negative for prices as the harvest pace can increase. Nigeria is reporting a delayed harvest due to recent rains, but experts good crops at the end. Quality reports from the rest of West Africa are good and grinders are there in the ports and are willing to buy. Meanwhile, some ideas that Europeans are eating less chocolate again hurt the market. The move lower in the last few sessions implies that the market has made at least a short-term top. Ideas of slightly lower production in West Africa give the Bulls reason to think that the current move down might be just a temporary correction. Reports from parts of West Africa indicate that the humidity has cost in terms of yield and quality recently. However, weather in the region is drier now and any production losses should be limited. The main crop harvest is active in West Africa. Conditions appear good in East Africa and Asia.
Overnight News: Mostly dry conditions are expected in West Africa. Temperatures will average mostly 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 3.630 million bags.
Chart Trends: Trends in New York are mixed to down with no objectives. Support is at 2140, 2130, and 2110 December, with resistance at 2220, 2280, and 2300 December. Trends in London are mixed to down with objectives of 1610 and 1540 December. Support is at 1570, 1540, and 1460 December, with resistance at 1650, 1680, and 1700 December.