Arabica coffee futures have continued their downward trajectory, trading near $2.50 per pound, marking a significant drop from the 13-year high of approximately $2.75 reached on Stember 26. This decline follows the European Commission's decision to postpone the implementation of an anti-deforestation law by one year, which enables uncertified coffee stockpiles to fulfill contracts until at least December 30. The delay has alleviated immediate concerns over a potential supply crunch.
Moreover, forecasts indicating essential rainfall in Brazil—the world's largest coffee producer—over the coming days have further reduced market anxieties. Nonetheless, industry analysts warn that while this rainfall is welcomed, it may not be adequate to completely address apprehensions surrounding the flowering of next year’s coffee crop, which remains vulnerable due to extended dry conditions.
Since the outset of 2024, coffee prices have surged by 55.50 USd/Lbs, or 29.48%, reflecting robust trading on a contract for difference (CFD) that tracks the benchmark market for this commodity. Projections indicate that coffee is expected to trade at 274.08 USd/Lbs by the end of the current quarter, according to global macro models and expert expectations. Looking a year ahead, estimates suggest a potential trading value of 298.61 USd/Lbs.