Coffee futures continued their upward trajectory last week, with the December contract rising 12.7 cents to close at 390.75 US cents per pound, driven by the rapid decertification of ICE certified inventories and weather-related concerns in Brazil.

The market remained at the top of its established 360-390 US cents per pound trading range, with certified stock drawdowns emerging as a key price driver. ICE certified inventories have been declining at an accelerated pace, with decertification activity intensifying during price rallies and slowing when futures prices decline.

According to Sucafina’s latest market analysis, some trade houses have cited the need to support US roasters facing high tariffs as a reason for decertifying inventories. While certified stocks maintain commercial value, particularly in the US market, their withdrawal from exchange warehouses creates a significant impact on both futures prices and spread differentials.

The relationship between certified stocks and price movements follows a clear pattern: when futures prices fall, certified inventories tend to increase as market participants move coffee into exchange warehouses. During price rallies, decertification accelerates as buyers secure physical supply.

Brazilian weather conditions also contributed to market nervousness last week. Coffee-growing regions experienced several days of hot and dry weather coinciding with the main flowering event. However, Sucafina’s agronomic team notes that conditions remain within normal seasonal patterns. The recent dry spell actually served a beneficial agronomic purpose, allowing cross-pollination and proper flower bud fixation. Rainfall is expected to return mid-week, which aligns with ideal post-flowering conditions outlined in coffee agronomy practices.

Despite the recent price strength, Sucafina expects the market to stabilize this week, with prices potentially moving toward 375 US cents per pound by Friday as weather concerns ease.

For coffee procurement managers, the current certified stock dynamics highlight the importance of monitoring inventory levels when planning sourcing strategies. The rapid decertification pace indicates strong physical demand and potential tightness in readily available supply, factors that could influence contract timing decisions.

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