MF GLOBAL: Our primary clearing firm, MF Global, has been in the news a lot over the last couple of days. Moodys has downgraded the debt due in part to its exposure to certain European debt, the firm missed analysts profit expectations by a wide margin, and in fact reported a big loss, and the stock and bonds of the firm moved sharply lower in trading on Wednesday and for the entire week. We are troubled by these reports and are looking at all of the alternatives available to us. Our customers, their faith in us, and the security of customer deposits remain our top concerns. The customer deposits held by MF Global should not be affected in any way. This money is kept in segregated accounts away from MF corporate money as required by US law and is safe. However, we are concerned about certain actions that have been disclosed over the last few days and about the viability of the firm going forward. MF Global appears to have sufficient liquidity at this time. We expect to have a formal announcement of what changes we will make, if any, in the very near future.

COTTON
General Comments: Futures were a little higher yesterday on speculative buying. It was mostly a short covering rally after futures could not push to new lows for the move. The trade was quiet, with traders showing more concern with Europe than with any news in Cotton. Europe is moving slowly to resolve its crisis, but too slowly for many traders and analysts. Export demand remains weak. Commercials have moved to the sidelines after being the best market support over the last month or so. Chart trends are mixed for the short term.
Overnight News: The Delta and Southeast will get mostly dry conditions, but showers are possible on Thursday. Temperatures will average near to above normal much of the week, but near to below normal by Friday. Texas will be mostly dry, but showers are possible tonight and tomorrow. Temperatures will average mostly near to above normal early this week and near to below normal late this week. The USDA average spot price is now 97.84 ct/lb. ICE said that certified Cotton stocks are now 0.025 million bales, from 0.024 million yesterday. USDA said that net Upland Cotton export sales were 385,100 bales this year and 0 bales next year. Net Pima sales were 900 bales this year and 0 bales next year. Pakistan now expects to produce 12.22 million bales of Cotton this year, down 6% from earlier forecasts.
Chart Trends: Trends in Cotton are mixed to down with objectives of 95.00 and 90.00 December. Support is at 99.00, 98.00, and 95.00 December, with resistance of 103.00, 105.00, and 107.00 December.

FCOJ
General Comments: Futures closed higher again yesterday as a hurricane grew south of the Yucatan. It is not going anywhere, and is no longer expected to have any impact on Florida. It is losing strength this morning. Florida weather remains a negative for prices for now. Florida has had good weather so far this year with showers most days and warm temperatures. This week should see drier weather. Early harvest is getting underway. Trends are up on the charts. Brazil is seeing warm temperatures. Showers are seen this week for Brazil.
Overnight News: Florida weather forecasts call for mostly dry weather today, but showers are possible starting Thursday. Temperatures will average near to above normal.
Chart Trends: Trends in FCOJ are up with no objectives. Support is at 189.00, 188.00, and 186.00 November, with resistance at 194.00, 197.00, and 200.00 November.

COFFEE
General Comments: Futures were lower in all markets due to ideas the economic issues in the EU might not be resolved soon. Prime ministers from the EU were meeting yesterday as scheduled, but did not issue any real definitive statements on what would be done moving forward. This took futures lower. Weather fears for Central and South America where rain threatened crops last week are easing as a hurricane forming south of the Yucatan still appears ready to move to the north and east and away from Central America. However, loss reports from Central America are coming in from the rains last week. The potential for big crops in Vietnam and Brazil later on keeps people wondering about upside potential, but trees are just starting to flower in Brazil and Vietnam and other countries in Southeast Asia has seen a lot of rain recently that could hurt cherries. Drier weather is forecast for Brazil this week, and dryness now would hurt flowering and cherry formation. Weather remains less than perfect in other places too, especially in Central America and Colombia where big and flooding rains have been reported in the last week. Futures still have to deal with a tight supply situation for the short term, and the possibility of less than expected Arabica Coffee produced over the next year. Differentials in all of Latin America remain strong. There has been some talk there that the Brazil production will not be as big as some estimates seen recently. Central America and Colombia are offering to sell new crop with high differentials.
Overnight News: Certified stocks are lower today and are about 1.289 million bags. The ICO composite price is now 194.93 ct/lb. Brazil should see showers today and Thursday, then mostly dry conditions. Temperatures will average near to above normal.
Chart Trends: Trends in New York are mixed. Support is at 228.00, 225.00, and 220.00 December, and resistance is at 237.00, 239.00, and 243.00 December. Trends in London are mixed to down with objectives of 1790 November. Support is at 1780, 1750, and 1735 November, and resistance is at 1860, 1880, and 1910 November. Trends in Sao Paulo are mixed. Support is at 318.00, 313.00, and 310.00 December, and resistance is at 327.00, 335.00, and 340.00 December.

SUGAR
General Comments: Futures closed lower yesterday as the European crisis continued. Traders liquidated positions after hearing news that EU ministers have not yet concluded an agreement on major issues. Ideas are that a solution to the problems over there has not been found. Supply side fundamentals for Sugar remain weak. India is still offering and expects to sell more as the country tries to work off surplus production and stocks. There were some flooding rains in Thailand last week that could have damaged Sugarcane and other crops. Reports are that losses are minor and most of the problems will be due to delayed crushing and deliveries rather than to crop losses. Bears keep pointing to increased supplies around the world and no demand this year from India as reasons to see futures move lower over time. Northern hemisphere crops are coming soon, and Europe is said to have very good crops this year.
Overnight News: Mostly dry conditions or light showers are expected in Brazil. Temperatures should be near to below normal. Russia has produced 2.174 million tons of Sugar from beets so far this year, from 1.489 million tons last year. Brazil Sugar production was 1.76 million tons in the first half of October, up 17% from last year. Russia is considering keeping import duties high as production is high this year in domestic markets.
Chart Trends: Trends in New York are mixed. Support is at 2630, 2610, and 2540 March, and resistance is at 2690, 2740, and 2770 March. Trends in London are mixed to up with objectives of 756.00 and 802.00 December. Support is at 718.00, 715.00, and 703.00 December, and resistance is at 735.00, 749.00, and 751.00 December.

COCOA
General Comments: Futures were higher in New York and in London yesterday on speculative buying. Trends turned up with the price action yesterday. Talk of oversupply in the market for Cocoa still are keeping prices down overall, but futures have already priced in the increased supplies for now as there has been no real follow through to the downside. There is still no real reason to buy for now, but next year could be different as many analysts say that crop production potential in western Africa has been hurt by some poor weather seen in the last month. However, current supplies are ample and should help cover any short production potential for next year. Weather is called good for production in West Africa now.
Overnight News: Scattered showers and storms are expected in West Africa. Temperatures will average near normal. ICE stocks are lower today and are now about 3.731 million bags.
Chart Trends: Trends in New York are mixed to up with objectives of 2740, 2890, and 3370 December. Support is at 2670, 2650, and 2620 December, with resistance at 2710, 2720, and 2740 December. Trends in London are mixed. Support is at 1690, 1660, and 1650 December, with resistance at 1720, 1750, and 1760 December.

Questions Ask Jack Scoville today at 312-264-4322