Arabica coffee (COFFEE) futures on ICE are down more than 2%, resuming downward momentum after prices briefly climbed above the 380 level. On one hand, global coffee inventories remain relatively low, and recent adverse weather in Brazil (heavy rains and frosts) suggests that seasonal harvests may be weaker. However, today we are seeing profit-taking after sharp gains.
Weather forecasts for Brazil’s Minas Gerais region remain subject to significant revisions, adding to market volatility. At the same time, high 50% tariffs on Brazilian coffee imports into the U.S. continue to shape market structure. Should there be any major changes to the U.S.–Brazil trade agreement in the future — either through reduced tariffs or their complete removal — a substantial downside potential for prices cannot be ruled out.

Source: xStation5
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