Sugar falls as world production grows

SUGAR (NYBOT:SBV13)

General Comments: Futures closed a little lower on reports in quiet trading. There is a lot of Sugar in the world, but not much on offer in the cash market for now. Processors in Brazil remain more interested in Ethanol production as it pays better. Traders are also noting good weather for Sugar production in India, and the crop is expected to be big there. Countries like Thailand and India also expect more production this year, and both countries are actively offering their supplies into the world market. 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. Chinese demand has been soft, but Middle East demand appears to be relatively good. Price appears to be in a trading range for now due to solid demand and big production.

Overnight News: Brazil could see dry weather and moderate temperatures Short term trends are now sideways.

Chart Trends: Trends in New York are mixed. Support is at 1625, 1610, and 1595 October, and resistance is at 1650, 1665, and 1685 October. Trends in London are mixed. Support is at 473.00, 470.00, and 465.00 October, and resistance is at 481.00, 486.00, and 488.00 October.

COTTON (NYBOT:CTV13)

General Comments: Futures closed a little lower and short term trends remain down. Futures traded lower as traders weighed slow crop development against improving conditions and improved weather. Very hot weather conditions in China continue, and the weather in Cotton areas is not really improving right now in that country. However, some showers are in the forecast to provide some help. Weather is moderate in the US. US crops remain behind the normal pace, but overall crop ratings are high and current conditions are called good. Texas is dry and warm. Weather for Cotton still appears good in India. The market is getting ready for the harvest, and any rallies now might be very limited in scope.

Overnight News: The Delta will be dry and Southeast will see a few showers. Temperatures will average above normal in the Delta and mostly above normal in the Southeast. Texas will see dry weather. Temperatures will average above normal. The USDA spot price is now 79.38 ct/lb. ICE said that certified Cotton stocks are now 0.016 million bales, from 0.016 million yesterday.

Chart Trends: Trends in Cotton are down with objectives of 82.70 and 81.20 October. Support is at 81.80, 81.20, and 80.00 October, with resistance of 84.00, 85.05, and 85.30 October.

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