Arabica coffee futures prices have hit a two-month high, surpassing US$3.50 per pound on 19 August.
The rise is said to be influenced by factors in Brazil, including worries about the impact of recent cold weather on production as well as producers holding back beans due to tariffs imposed by United States (US) President Donald Trump.
“It is clear that even with the recent price increases, producers have not yet shown much interest in selling,” Thiago Cazarini, a broker based in Brazil’s top producing state of Minas Gerais, told Bloomberg.
President Trump’s government has hit all imports from Brazil with a 50 per cent tariff as part of an executive order, which labelled the “recent policies, practices, and actions of the Government of Brazil” as “an extraordinary threat” to the US.
As a result, coffee buyers in the US have been requesting to postpone imports from the South American country in the hope that negotiations on the tariffs will reach a more favourable outcome.
