Morgan Stanley Coffee Report - March 16, 2021

​Arabica recorded a particularly futures focused day as KCK fell 90 points to 132.10.  Outright trading in K surged to its heaviest turnover in 4 days as the market settled 70 points below the VWAP and 10 below Friday’s VWAP.  While broad commodity weakness can be blamed in part, select other ags that managed to turn positive and the DXY and BRL were both modest headwinds at most.  The larger issue was a series of hefty sell side market orders, deployed through the intraday low (600+/- lots) and another through Friday’s low (another 500+/- lots) as KC recorded its intraday bottom.  Each blow off encountered support, but outside of the deepest 80 points drove little in terms of aggressive buying.   Longer term spreads floundered as well, KK continuing its outward momentum to -8.70, -.20, while KN (-2.00, -.05) and NU (-1.90, +.05) were a wash in the nearbys.  Options were uncharacteristically quiet, paced by the N 135 C at a mere 537 lots.  Coffee has a few new inputs on tap with today’s GCA stock report and Wednesday’s dual BCB / FOMC events.  London closed 1388, $15 lower after Friday’s eventful COT.  Spreads were little changed.