Iced Coffee Boils
Coffee is 15% higher Tuesday, adding to a 10%-move Monday
as forecasts for freezing temperatures in the primary growing regions of Brazil
come true. The largest growing state, Minas Gerais, said temperatures dropped to
below freezing Tuesday in the lower lying areas of the region, implying
higher-elevation plantations would have experienced even lower temperatures, and
possibly greater crop-damage. Coffee registered on the New 10-Day Highs List.
A higher-than-expected Consumer Price Index (CPI) report
is taking some of the heat out of the rally in equity index futures. The Nasdaq
is down triple-digits, trading through a limit-down curb, and the S&Ps and Dow are also lower.
Crude oil and the energy complex are moving higher
despite statements by Saudi Arabia that it would increase output by one-half
million barrels a day. The trade is concerned that the Saudis will stick to its
cartel agreement to only raise production if a basket of OPEC crude remains
above $28 per barrel for over 20-days, rather than unilaterally increasing
production. Monday, the price of OPEC crude fell below $28, casting doubt on
whether any new production would hit the world market.
Soft and fiber contracts from the Momentum-5
List, are breaking away. Sugar gapped to a new contract high for the second
consecutive day. Cotton is following its limit-up move Monday with a
continuation move Tuesday.