Morgan Stanley Coffee Report - November 12'18

Coffee struggled to start the week, settling -350 points at 114.00.  Prices gapped lower off the opening leaving a 117.40 – 117.20 hole to plug in the future.  Macro selling was evident for much of the US trading day, and the DXY was a weight for much of that session.  Sugar traded a remarkably similar path, even as the BRL posted a more volatile / less coherent trading day, suggesting a sell softs program may have been in effect.  Spreads action was heavy as one would expect midway through the index roll.  Z/H bowed to pressure into the close, trading the day’s weakest bid/ask throughout the settlement window after concerted selling wore out the buyers minutes in advance.  London fell $31 to settle 1654 basis Jan, outperforming KC intraday for much of session.  MOC selling knocked out roughly ½ cent of premium as the curtains fell on London.