Coffee futures plummeted on Wednesday 🍵

KCH26 plummeted 0.94%, RMF26 plummeted 1.01%, mainly due to the European Union's one-year delay on the "EU Deforestation Regulation" (EUDR), which means that global coffee supply can continue to remain loose.

But the bears won't be happy for too long - Brazil's drought has raised alarms, with the rainfall in the Minas Gerais region only at 49% of the historical average; Vietnam's rainfall expectations, on the other hand, will delay the harvest period. ICE Arabica inventories have fallen to a 1.75-year low (398,600 bags), while Robusta inventories have hit a new low in 6.25 months.

Key data: After Trump temporarily exempted Brazilian coffee from tariffs, U.S. imports of Brazilian coffee plunged 52% YoY (984,000 bags) in August to October. However, StoneX predicts that Brazil's production in the 2026/27 season will surge by 29% YoY to 47.2 million bags, while Vietnam's production is also set to reach 17.6 million tons in 2025/26 (a four-year high).

ICO data shows that global coffee exports slightly declined by 0.3% this marketing year, with significant fluctuations on the supply side, but still have short-term support.