A firm Brazilian real and an oversold market triggered speculative short covering Monday. In addition, late
comments on Friday from Mr. Jorge Esteve from Brazil, raising concerns about the lack of rains in Espirito Santo and east of Minas provided support to the prices. The nearby contract for December delivery settled 220 points higher at 114.35 cents a pound while the March contract settled 240 points higher at 118.20 cents a pound. The volume rose to 53,347 lots, boosted by 18,619 switches. The active December – March switch widened 30 points to end at -3.90 cents. The action attracted good spec participation, particularly the program traders. Typically with a contango market, this structure tends to expand a little further ahead of the First Notice Day, Nov 19. The COT report was released today. Non-commercial participants added 5,315 net shorts to a total of 29,201 net shorts. The commercials reduced 3,838 net shorts to a total position of 2,506 net shorts. GCA October stocks decreased 168,880 bags to 5,948,228 bags. October 2014, stocks declined 25,849 bags, and the average of the last five years is a decline of 176,770 bags.