FX.co ★ Coffee Prices Stay Firm on Supply Concerns

Arabica coffee futures are currently trading around $4.11 per pound, approaching the nine-month peak of $4.23 reached on November 11. This is largely due to ongoing factors such as tariffs, crop issues, and market speculation. The imposition of earlier US tariffs on Brazilian coffee had significantly limited exports, driving futures to unprecedented heights, with recent tariff exemptions providing only limited alleviation. Additionally, subpar harvests in Brazil combined with severe rainfall in Vietnam have tightened global supplies, and stockpiles monitored by exchanges are nearing their lowest point since March 2024. Trader caution and speculative activities have intensified price fluctuations, maintaining elevated futures prices despite occasional short-term declines. The robust global demand, coupled with a constrained supply and prevailing market uncertainties, has kept prices well above the five-year average and they are anticipated to remain historically high in the near future.