COTTON           

General Comments:  Cotton was lower and is testing the lower end of the trading range.  The market got some good news on Friday as USDA reported the strongest week of export sales for the year, but that did not seem to impress the market as prices sank yesterday.  China was included as a buyer which has been considered important for Cotton demand moving forward.  China has also been buying Cotton from Brazil as it needs higher quality Cotton to blend with its domestic production.  The market also displayed little reaction to the lower than expected production and ending stocks estimates released by USDA the previous week.  The market has not been able to move a lot in terms of price for the last month as the harvest has been ongoing amid some stressful conditions.  The harvest will start to wind down over the next couple of weeks and certified inventories have been steadily growing but will soon start to level off.  The market could hold to a sideways to weaker pattern until the tail end of the harvest.       

Overnight News:  The Delta should see dry weather except for showers on Thursday and Friday and above normal temperatures.  The Southeast should get some showers on Friday and Saturday.  Texas will have mostly dry conditions except for some rain tomorrow and Thursday.  Temperatures will be variable but mostly above normal.  The USDA average price is now 61.01 ct/lb.  ICE said that certified stocks are now 65,199 ba1es, from 62,446 bales yesterday.  USDA said that Cotton is now 68% harvested, from 62% last week, 58% last year, and 66% average. 

Chart Trends:  Trends in Cotton are mixed.  Support is at 6350, 6340, and 6290 December, with resistance of 6500, 6550, and 6570 December.

FCOJ

General Comments:  FCOJ was lower as the weather remains good for oranges crop development and harvesting in Florida.  There is a potential tropical storm in the West Indies right now but it is forecast to move north and not west if it develops.  It would miss Florida and probably the entire US.  Overall chart patterns suggest that the market is in a trading range even through the price action is weak.  Futures had held the same range since April.  USDA showed strong production last month at more than 77 million boxes of Oranges from Florida and demand remains weaker.  Good growing conditions and increased oranges production estimates by USDA this season have been bearish.  The weather has been great for the trees as there have been frequent periods of showers and no severe storms so far this year.  Many areas have been dry lately and irrigation is being used.  Crop yields and quality should be high for Florida this year.  Inventories of FCOJ in the state are high and are more than 33% above last year.    

Overnight News:  Florida should get mostly dry weather this week.  Temperatures will average mostly below normal today and tomorrow but above normal later this week.   Brazil should get mostly dry weather and above normal temperatures.  ICE said that 0 notices were posted for delivery against November contracts and that total deliveries for the month are now 206 contracts. 

Chart Trends:  Trends in FCOJ are mixed.  Support is at 96.00, 95.00, and 92.00 January, with resistance at 101.00, 102.00, and 104.00 January.

COFFEE 

General Comments:  Futures were lower again yesterday on what appeared to be speculative selling.  Ideas of good weather in Brazil and reports of some offers from Central America kept the market down.  Rains were reported last week in Brazil Coffee areas to help ideas of big production in the coming year and more precipitation is expected this week.  The Brazilian crop is developing but some exporters say they are out of previous crop supplies to sell.  The Asian harvest is underway but producers do not seem to be selling on ideas that prices are too low to provide profits.  Vietnam exports remain behind a year ago, but the market anticipates bigger offers as producers and traders will need to create new storage space and are expected to do this by selling old crop Coffee.  Reports from Brazil indicate that flowering is off to a very good start.  Rains are expected again in Coffee areas this week.  Vietnam crops are thought to be big despite some uneven growing conditions this year.  A tropical system hit production areas in the last couple of weeks but so far there have been reports of some damage and losses.

Overnight News:  ICE certified stocks are lower today at 2.180 million bags.  The ICO daily average price is now 105.50 ct/lb.  Brazil will get scattered showers and near to above normal temperatures.  Vietnam will see scattered showers in all areas, but trends are a little drier now. 

Chart Trends:  Trends in New York are mixed.  Support is at 105.00, 104.00, and 103.00 December, and resistance is at 108.00, 110.00 and 111.00 December.  Trends in London are mixed.   Support is at 1360, 1340, and 1330 January, and resistance is at 1390, 1410, and 1430 January.

SUGAR               

General Comments:  Both markets closed higher on follow through buying.  London was the stronger market.  Some buying came on reports of crop losses to Sugarcane in Louisiana due to the recent freeze.  American and Canadian Sugarbeet producers have also had big problems and some shippers of beets might have declared force majeure.  Overall charts trends are trying to turn up for the medium term in New York but are sideways in London.  Reports indicate that little is on offer from India.  Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season.  There is still more than enough Sugar for any demand and that India will have to sell sooner or later.  Reports from India indicate that the country is seeing relatively good growing conditions and still holds large inventories from last year.  However, these supplies are apparently not moving and this could be due to less government subsidy for mills and exporters.  Reports of improving weather in Brazil imply good crops there. 

Overnight News:  Brazil will get scattered showers this week.  Temperatures should be near to above normal.   

Chart Trends: Trends in New York are mixed to up with objectives of 1310 March.  Support is at 1260, 1240, and 1230 March, and resistance is at 1290, 1300, and 1320 March.  Trends in London are mixed.  Support is at 335.00, 331.00, and 327.00 March, and resistance is at 345.00, 348.00, and 351.00 March.

COCOA              

General Comments:  Futures closed mixed to a little lower in consolidation trading after the big rally last week.  Speculators appeared to be on both sides of the market.  The weekly charts imply that a significant rally is underway.  It seems that the market is short Cocoa for the demand even through arrivals have been stronger so far this season from West Africa.  Harvest is now active in West Africa and reports are that good volumes and quality are expected.  Ideas are that demand is currently very strong due to the current price action.  The reports from West Africa imply that a big harvest is possible in the region.  Ivory Coast arrivals are strong and are above year ago levels.  The weather in Ivory Coast has improved due to reports of frequent showers.  The precipitation is a little less now so there are no real concerns about disease.  Ideas are that the next crop will be very good.  Both Ivory Coast and Ghana are doing what they can do boost Cocoa prices and are inviting Nigeria and Cameroon into the minimum pricing system they are creating.

Overnight News:  Scattered showers are expected in West Africa.  Temperatures will be near to above normal.  Malaysia and Indonesia should see scattered showers.  Temperatures should average above normal.  Brazil will get scattered showers and near to above normal temperatures.  ICE certified stocks are lower today at 3.153 million bags.  ICE said that 0 contracts were posted for delivery against December contracts and that total deliveries for the month are now 95 contracts. 

Chart Trends:  Trends in New York are up with objectives of 2820 March.  Support is at 2600, 2570, and 2540 March, with resistance at 2690, 2720, and 2750 March.  Trends in London are mixed to up with objectives of 2050 March.  Support is at 1920, 1900, and 1870 March, with resistance at 1970, 2000, and 2030 March.

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