Alaron Soft Commodity Comment

CHICAGO - Apr 17/07 - SNS -- Following is the cocoa, sugar, orange juice and cotton futures comment from Alaron Trading Corp.

May OJ futures closed 240 points higher yesterday at 170.15. The market opened lower and filled a downside gap at 165.50. This gap was from last October's rally. OJ prices have dropped 2700 points since the beginning of the month. This sell-off we have seen has been technical in nature. The USDA lowered its Florida crop estimate this month to 130.7 million boxes versus 132 million last month. This market is really undervalued at these levels. The cash market has a 50-60 cent premium over the futures market. We should see more strength in this market as we get closer to the first notice period for the May contract on May 1st. Support for May is at 168.50. Resistance is at 171.00.

In the other softs markets, coffee gave back most of its gains from last week on local and spec selling. We are in the seasonal period when coffee prices have the tendency to move higher. This is because a weather premium gets built into the market ahead of the Brazilian winter. The seasonal runs through mid-May. The market has been pressured the last couple of month as supplies have been abundant. The longer-term fundamentals are supportive as the Brazilian crop is expected to come in smaller. First notice for the May contract is on Friday, 4/20. Support for May is at 108.00. Resistance is at 110.00.

Sugar prices filled an upside gap yesterday at 10.06. This market cannot muster any upside momentum as the fundamnetals remain bearish for this market. Brazil has been harvesting their crop, which has added more supply to an already large amount of stocks. In addition, the cash market remains weak at these low price levels. With the May contract set to expire at the end of this motnh, we could continue to see lower prices, possibly down to 9.00. The only thing that can turnaround this market quickly is if funds and specs begin to cover short positions. There is a double-bottom at the contract low fo 9.66. Support for May is at 9.60-9.66. Resistance is at 10.00-10.10.

May Cotton pushed to a new contract low yesterday of 50.05. There was follow-through selling from funds and specs yesterday. The market has been under pressure due to the lack of demand. There were high expectations of strong demand for the first quarter from China. When that didn't happen, prices were able to gain any strength. The market could be putting in a pre-planting low shortly as planting acreage this year will be reduced. Support for May is at 50.00. Resistance is at 51.00.

Boyd Cruel

Alaron Research Team

800.216.1491

bcruel@alaron.com

www.alaron.com

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