Sugar moves higher in consolidated trading

SUGAR (NYBOT:SBV13)

General Comments: Futures closed higher in consolidation trading. The fundamentals do not support any major rallies in the market, and not much has changed in sugar. Some buying has been noted in reaction to the falling Indian rupee that makes it harder to believe that the country will export much. Many expect production to be higher overall in Brazil due to a record Sugarcane production, and countries like Thailand and India also expect more production this year. Some Sugarcane was damaged in the freezes of a couple of weeks ago, but the total losses are not clear and Price action suggests were not enough to change things very much. Less production of Sugar beets is reported from Russia and Ukraine as farmers there elected to plant more grains. Demand for ethanol has been good, but there is still a lot of Sugar and the supply side fundamentals seem to overwhelm any demand side strength over time.

Overnight News: Brazil could see dry weather and moderate temperatures.

Chart Trends: Trends in New York are mixed. Support is at 1650, 1635, and 1615 October, and resistance is at 1680, 1710, and 1715 October. Trends in London are mixed. Support is at 484.00, 479.00, and 473.00 October, and resistance is at 494.00, 496.00, and 499.00 October.

COTTON (NYBOT:CTV13)

General Comments: Futures closed sharply higher on reports of very hot weather conditions in Chinese production areas that could hurt yields. China buys a lot of US Cotton and might need to buy more if production there is hurt. US crops remain behind the normal pace. The poor planting conditions early in the year have made the crop progress behind normal. Temperatures are warmer again in Texas, and it has turned dry again. Conditions in Alabama, Mississippi, and Missouri are good after some big rains earlier in the growing season and rains in recent days as well. Export sales have been on the weak side lately as the buy side of the market waits for prices to work lower. World production ideas are also high. Weather for Cotton still appears good in India.

Overnight News: The Delta and Southeast will see mostly dry weather today and tomorrow and showers this weekend. Temperatures will average near to above normal. Texas will see dry weather this week and maybe a shower in the north. Temperatures will average above normal. The USDA spot price is now 84.45 ct/lb. ICE said that certified Cotton stocks are now 0.062 million bales, from 0.070 million yesterday. USDA said that net Upland Cotton export sales were 81,400 bales this year and 0 bales next year. Net Pima sales were 14,700 bales this year and 0 bales next year. USDA noted that the crop marketing year has now changed.

Chart Trends: Trends in Cotton are up with objectives of 89.60 and 92.80 October. Support is at 87.80, 87.45, and 87.00 October, with resistance of 89.65, 90.10, and 90.70 October.

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