Sugar unfazed by weather in Brazil amid surplus


General Comments: Futures were lower as big production ideas continue. Some are talking about dry weather in Brazil right now and that it could impact production of the next crop, but the market knows there is still a lot of Sugar. Thai offers are strong and differentials are holding steady. Thai Raw Sugar differentials are starting to weaken as Thai exporters try to move a big crop as fast as possible. Thai exporters are worried about increasing offers from India and lower prices for futures and differentials down the road. They are offering Raw Sugar now and intend to offer White Sugar later in order to move the product as quickly as possible. India is still offering. Brazil is offering less now that the harvest season is over. Weather conditions in key production areas around the world are rated as mostly good except for the possible dry weather in Brazil.

Overnight News: Brazil could see dry weather and near to above normal temperatures.

Chart Trends: Trends in New York are down with objectives of 1470 and 1440 March. Support is at 1460, 1430, and 1400 March, and resistance is at 1510, 1530, and 1550 March. Trends in London are mixed to down with no objectives. Support is at 400.00, 397.00, and 394.00 March, and resistance is at 410.00, 415.00, and 420.00 March.


General Comments: Futures closed higher in consolidation trading. Price action yesterday could indicate that the market has found short term low. Bears point to the bad Price action after the very strong export sales report on Friday as a reason to keep pushing prices lower while Bulls point to tight supplies here in the US as a reason to buy. Prices are high enough now to cut off some demand and also to make some producers consider increasing planted area next year. But, the market needs to keep seeing demand, and needs to see some planting intentions from producers to be able to make longer term judgments. It is possible that futures continue in a trading range between 82.00 and 87.00 basis nearby futures for a while. Brazil conditions are reported to be very good in Bahia with light precipitation and warm temperatures.

Overnight News: The Delta and Southeast will see more precipitation move from west to east this weekend. Temperatures will average below normal, but will moderate this weekend before turning cold again next week. Texas will see dry conditions. Temperatures will average above normal by Friday and into the weekend, then turn below normal again next week. The USDA spot price is 82.00 ct/lb. today. ICE said that certified Cotton stocks are now 0.146 million bales, from 0.136 million yesterday. USDA said that net Upland Cotton export sales were 479,700 bales this year and 51,900 bales next year. Net Pim sales were 7,800 bales this year and 0 bales next year.

Chart Trends: Trends in Cotton are mixed to down with objectives of 8250, 8185, and 8070 March. Support is at 85.00, 84.00, and 83.70 March, with resistance of 86.00, 87.00, and 88.20 March.

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