* Speculators cut cocoa shorts for third straight week
May 11 (Reuters) - Speculators switched to a net short position in raw sugar futures and options on ICE Futures U.S. in the week to May 8, for the first time in nearly four months, U.S. Commodity Futures Trading Commission data showed on Friday.
Speculators cut 13,691 contracts, turning to a net short position of 9,931 contracts in raw sugar, the data showed.
The switch came as the benchmark July raw sugar futures contract dropped to 20.31 cents per lb, the lowest for the spot position since September 2010.
“The specs got sucked into the bullish argument in March and subsequently realized the bullish argument had no legs,” said Jeff Bauml, a senior vice-president with brokerage R.J. O‘Brien & Associates in New York.
“Come the middle of April they started to get out of longs and started to look at shorts.”
“Having broken the 20.40 (cents per lb) level there is a school who believe the market could go to a low of 18 cents. I don’t subscribe to that,” Bauml said.
“I think that between 20 cents and 19 cents you will have end-user off-take that has been dormant, waiting to start to buy.”
The speculators trimmed their net short position in cocoa for the third straight week, cutting 5,028 lots to 21,537 lots. In arabica coffee futures and options, they increased their net short position by 2,187 contracts to 20,873 contracts, bringing it to a three week high.
In cotton, speculators cut their net long position by 3,958 lots to 6,451 lots, the data showed.