International Market Feels the Weight of Trade War and Global Uncertainty

The international coffee market closed Monday (7th) with a steep drop, as robusta futures fell by 6.40% and arabica by 5.72%. The bearish pressure was mainly driven by growing risk aversion across global markets, sparked by fears of an escalating trade war. The proposed tariffs are expected to directly impact consumer prices and, consequently, reduce coffee demand. Additionally, the Brazilian real’s depreciation to a two-and-a-half-month low against the dollar encouraged Brazilian producers to ramp up export sales, further pressuring international prices.

However, industry experts emphasize that the recent price movement does not reflect market fundamentals. Marcus Magalhães, executive director at MM Cafés, noted that the current situation is a result of temporary panic triggered by fears of a global recession and uncertainty surrounding tariff policies. The Carvalhaes Office also points out that despite the turbulent moment, low stock levels in both producing and consuming countries, as well as adverse weather conditions, provide structural support for prices. Nonetheless, they recommend caution and patience until the direction of global trade negotiations becomes clearer.

In the Brazilian domestic market, the day ended with mixed results, as producers became more cautious in response to New York’s price drops and the rising dollar. Some regions, like Patrocínio/MG and Guaxupé/MG, saw price decreases, while others, such as Machado/MG and Poços de Caldas/MG, recorded slight gains. The Carvalhaes bulletin also noted that the volume of sales remains below the level needed to meet both domestic consumption and export demand, reflecting the uncertain environment and producers’ hesitation as they wait for better pricing references. Fonte: Notcias Agrícolas Preço do café robusta fecha sessão desta 2ª feira com recuo de mais de 6% e... - Notícias Agrícolas