Hurricane Irma's forecast path took a turn west, pushing it
right through centre-west Florida, up into Georgia.
And with that, New York orange
juice futures soared anew, with Florida by far the top US orange growing
state, and juice producer, with cotton
gaining support too.
"The latest hurricane track cone now brings widespread rain
to the Delta, South East, and lower Midwest," said Terry Reilly at Chicago
broker Futures International.
"Expect serious damage to Florida's sugar cane, citrus trees, cotton, and vegetable crops."
'In danger of yield
and quality losses'
For the Florida orange industry, the fear is not just of
immediate damage from winds expected at 74-110mph, as Irma rips through the
state, but that many growers will shift into other crops rather than bother
replanting, and wait 5-7 years before trees reach full production.
best-traded November orange juice contract soared 4.4% to 152.80 cents a pound in
early afternoon deals in New York, earlier touching its 200-day moving average
at 154.63 cents a pound for the first time in nigh on eight months.
New York-traded cotton, meanwhile, gained 1.3% to 75.20
cents a pound for December delivery.
Louis Rose at Rose Commodity Group said that Hurricane
Irma's latest projected path places "a larger area of US cotton acreage, in
Alabama, Florida, and south east Georgia, in danger of yield and quality losses
compared with the previously published track.
"Too, the most recent forecast shows that rain and showers
associated with the storm could reach into the northern Mississippi River Delta,"
with heavy rains less than ideal at this time of year, when many crops have
open bolls at risk of rotting in wet conditions.
'Lots of chatter
about a lower dollar, but…'
The gains in cotton
might have been bigger were it not for some disappointing US export sales data
for last week, at 119,100 running bales including Pima, less than half the
previous week's total.
Indeed, for all the talk of a weaker dollar, which earlier on hit its lowest since January 2015, there
was a bit of a "show me" theme about whether the softer currency would actually
translate into higher US crop export sales.
"The dollar weakness needs to translate into some real
demand before it can be counted as a bullish input," said Tregg Cronin at Halo
At RJ O'Brien, Richard Feltes said that there was "lots of
chatter about a lower dollar boosting US exports.
"But there is no evidence as yet that the lower dollar is
offsetting the impact of record Brazil row crop loadings undercutting US
In fact, weekly US export sales for soybeans were good, at some 1.16m tonnes (putting net cancellations
for 2016-17 against the 1.52m tonnes of new season orders ).
Corn's at 650,000
tonnes or so, on the same basis, were OK too.
Still, export sales so far are still well behind, compared
with last year's pace.
"Importantly, new crop corn sales are down 6.5m tonnes
versus a year ago, while soy sales are down 6.9m tonnes," RJ O'Brien's Richard
The lag in US soy sales, combined with the prospect of higher
Brazil soy sowings, when plantings begin next week in earnest and a fear that
USDA "is understating 2017 US soy area are negative undertows for the soy
market", he added.
'Positive for prices'
There are some causes for support too, in the weather
outlook, which Mr Feltes acknowledged leant "positive" for prices, with a "drier
tone in the 6-10 day Midwest forecast, unfavourably wetter conditions in Argentina,
and being unfavourably drier in Ukraine".
Benson Quinn Commodities flagged that "the forecasts
continue to point to dry conditions for the bulk of the Corn Belt through the
end of the month".
Still, soybean futures for November stood down 0.3% at $9.66
a bushel in Chicago, with an hour or so's trading to go.
Corn futures for December, meanwhile, were up 0.4% at $3.56 ¾
Corn vs soybeans
If that seemed a little against the run of play, corn's
relative strength was down at least in part to a more positive attitude to
spreads in the grain against soybeans.
"There is only so much you can do with that spread, when you
are making fresh all-time highs in the November soybean-December corn ratio,"
said Mike Zuzolo at Global Commodity Analytics.
Wheat, which has
also been the target of short bets, joined in on the act too, adding 0.3% to $4.38
¾ a bushel in Chicago for December delivery, despite some poor US export sales
data, at 375,500 tonnes, down 30% week on week.
Spring wheat data were particularly poor, yet Minneapolis
futures added 0.3% to $6.51 ¾ a bushel, continuing to find support in a
stronger Canadian dollar (Canada is a huge spring wheat exporter) and protein
"The world has plenty of lower protein milling wheat, but
still worries persist for tighter protein supplies," said CHS Hedging.
Back in New York, arabica
coffee looked for a firm finish to a mixed week, standing 1.1% higher at
130.55 cents a pound for December delivery.
Negative pressure on values this week has been applied by talk
of a decent start to early flowering for coffee trees, ahead of the 2018
After some good rains, "early flowering has been reported in
Brazil," said Jack Scoville at Price Futures.
"Pictures show that flowering is off to a very good start."
However, dryness has
returned to coffee areas, "and some producers are worried that the rains came
too early and created premature flowering", Mr Scoville said.
"The flowers could drop and reduce the production potential."
The analysis was echoed by merchant I&M Smith, which said
that "Brazil weather reports indicate that most of the main coffee districts
have had a dry week and it is likely to remain the same for the coming week.
"This is likely to bring forth some degree of speculation
over the threat to the sustainability of the early flowering that came with the
early rains during last month, over most of the main arabica coffee districts."
Already there have been question marks over Brazil's ability
to achieve a 60m-bag crop next year, as some have forecast.
"'But it is early days and the focus remains upon the
prospects for the rains late this month and during October."