Cotton higher on strong Chinese demand, planting slows

COTTON

General Comments:  Futures were higher in consolidation trading and ideas of good demand left from the weekly export sales report from USDA.  The sales were big and China was the major buyer.  Planting conditions for the next crop remain a problem in the US.  Rains are moving through the Delta and Southeast through this weekend to slow planting progress, and Texas is cold again.  Weather will be watched as more wet weather in the Delta and Southeast could create less interest in corn and more in cotton to avoid having corn pollinate in the hottest time of the year.  So far, planting of all crops is slow.  Short term trends are trying to turn down, but bulls got a lot of help yesterday from the strong demand news.

Overnight News:  The Delta and Southeast will see mostly dry weather until rains develop in the Delta on Friday.  Temperatures will average above normal.  Texas will get mostly dry weather.  Temperatures will average near to above normal.  The USDA spot price is now 81.52 ct/lb.  ICE said that certified Cotton stocks are now 0.494 million bales, from 0.495 million yesterday.  ICE said that delivery notices were 0 contracts today and now total 545 contracts for the month. 

Chart Trends:  Trends in Cotton are mixed.  Support is at 83.60, 82.85, and 82.20 July, with resistance of 87.60, 88.05, and 88.50 July.

FCOJ

General Comments:  Futures closed higher in consolidation trading.  Traders are wrestling with more reports of losses from greening disease on the one side and beneficial rains that have hit the state and are expected to hit the state later this week on the other hand.  The growing conditions in Florida are expected to improve with the rains.  Greening disease and what it might mean to production prospects continues to be a primary support item.  Irrigation is widespread, even with recent rains.  Temperatures are warm in the state.  The Valencia harvest is continuing.  Brazil is seeing near to above normal temperatures and dry weather.

Overnight News:  Florida weather forecasts call for just a few light showers.  Temperatures will average near to above normal. ICE said that 4 delivery notices were posted today and that total deliveries for the month are 104 contracts.

Chart Trends:  Trends in FCOJ are mixed.  Support is at 141.00, 139.00, and 136.00 July, with resistance at 145.00, 146.00, and 147.50 July.

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