Morgan Stanley Coffee Report

Coffee suffered one of the slower sessions as volume posted a 4th straight decline.  Opening strength through the 145 level was short lived, as buyers took out resting offers yet no follow up emerged.  The recent NY arrival hour selling again showed up on schedule, wiping out the small plus signs that greeted the western side of the Atlantic.  The 143 level would find great interest shortly thereafter, yet it appeared few had much of an axe to grind from either side.  As Dec went off the board in KC, spread interest was muted, matched by relatively low turnover in FH robusta as we approach first notice day with a spate of holidays on the schedule.  One imagines the roughly 22k lots of OI that remain in the contract will fall precipitously with the traditional EFP next week, leaving one to wonder how much book squaring truly remains to be done.  Options in Arabica featured little volume, while the 2200 / 2400 CS in Robusta again found 1000 lots of interest, this time in March.  The BRL gained modestly following the BCB’s Ilan Goldfajn presentation of its agenda, focusing on four pillars of financial citizenship, modern legislation (reduced bureaucracy), a more efficient financial system, and costs of credit, as they seek to create interest bearing deposits.