Daily Coffee Report 8/10/26
Daily coffee report
StoneX Coffee Team
- Coffee
SECOND UPDATE: US Decertifies Colombia on Its War on Drugs; But Does Not Slap Sanctions Yet, Maintains Assistance
By: Diana Delgado, Contractor
SECOND UPDATE: US Decertifies Colombia on Its War on Drugs; But Does Not Slap Sanctions Yet, Maintains Assistance
(Adds comments from the Colombia-American chamber of commerce (Amcham)
Coffee Network (Bogota) – The United States has decertified Colombian in its war against drugs claiming that coca cultivation and cocaine production have surged to all-time records under President Gustavo Petro, yet the US government conditioned actions to avoid sanctions against the country, the US Department of State said.
Donald Trump's resolution also slams Venezuela, Bolivia, Afghanistan, and Myanmar for "demonstrable failure" in combating narcotics throughout fiscal year 2024.
Trump, however, used a waiver, or exceptional measure, to exempt the designated countries from sanctions, except in the case of Afghanistan.
As a result, funding for military assistance will continue. Colombia receives over $450 million each year from the US in cooperation to fight its war against drugs. It is understood that no tariff increases will be applied.
“I have determined (...) that United States assistance to Bolivia, Burma, Colombia, and Venezuela is vital to the national interests of the United States.”
Marco Rubio, Secretary of State, is calling for more aggressive action on illicit crops, a reduction in cocaine production, and greater cooperation to bring Colombian criminals before U.S. authorities. Otherwise, Colombia could face harsher sanctions in the future.
“Under President Petro’s leadership, coca cultivation and cocaine production have reached record highs while Colombia’s government failed to meet even its own vastly reduced coca eradication goals, undermining years of mutually beneficial cooperation between our two countries against narco-terrorists. For this reason, I have designated Colombia as having failed demonstrably to meet its drug control obligations,” the State Department said.
The State Department added that the failure of Colombia to meet its drug control obligations over the past year rests solely with its political leadership.
“I will consider changing this designation if Colombia’s government takes more aggressive action to eradicate coca and reduce cocaine production and trafficking, as well as hold those producing, trafficking, and benefiting from the production of cocaine responsible, including through improved cooperation with the United States to bring the leaders of Colombian criminal organizations to justice,” it added.
Speaking to a cabinet meeting Petro said: “The United States decertifies us after dozens of deaths of police officers, soldiers, and ordinary people trying to prevent cocaine from reaching them. Everything we do really has nothing to do with the Colombian people,” he noted.
Colombian analysts were fearing that the decertification could lead to an increase of tariffs. The former minister of commerce and finance Jose Manuel Restrepo, said earlier today a decertification could lead to an increase in tariffs to Colombian products. Colombian coffee and cocoa exports currently pay a 10% tariff to enter the US.
Colombia reached 253,000 hectares of coca crops in 2023, up 10% on the previous year, according to the Integrated System for Monitoring Illicit Crops (SIMCI) report of the United Nations Office on Drugs and Crime (UNODC).
The government’s anti-narcotics strategy has taken a much more permissive stance on coca crops than predecessors, according to Insight Crime.
AmCham Colombia called on the National Government to urgently present and implement a roadmap with achievable and verifiable goals that demonstrate political will and substantial improvements in crop eradication, production and trafficking reduction, judicial cooperation, and the financial dismantling of criminal organizations.
Amcham also invited the United States to recognize the progress in interdiction and seizures and to consider announcing the resumption of spraying, where appropriate and under the safeguards of the Constitutional Court, complemented by alternative development and a comprehensive state presence. These signals should help avoid measures that affect trade, tourism, and investment between the two countries.
The Colombian coffee exporters association Asoexport had said the US decertification could lead to the loss of trade preferences, which will impact coffee exports. The negative perception of investment for trade, deterioration in the country's image as an investment destination, or drastic things such as disconnecting the country from the financial system.
Colombian green coffee exports reached 11.42 million bags in 2024, which represented an increase of 17%, compared with 9.73 million bags exported in 2023. The US contributed with almost 40% of the total exports.
Coffee exports to the US were worth US$1.29 billion as of November, compared with $1.35 billion in full year 2023, the coffee growers federation said.
Since taking power in 2022, Colombian President Gustavo Petro has directed the efforts of security forces and institutions toward seizing drugs and attacking the most lucrative links in drug trafficking, while helping rural communities move toward legal alternatives. His predecessors were more focused on eradication, a move the United States has helped fund for decades.
Amcham had said earlier today the United States remains Colombia's main trading partner. Exports totaled US$8.8115 billion, representing 31% of total sales in January-July, according to figures from the statistics department DANE.
65% of products exported to the US are from the non-mining-energy sector, versus 35% from the mining-energy sector, between January and July, according to DANE.
On average, more than 3,000 companies export products to the United States each year, representing 35% of those exporting worldwide, according to DIAN data. So far in 2025, through July, 2,485 companies have exported to that country.
The United States remains Colombia's main historical investor. Investment in the first quarter of 2025 was recorded at US$1,080.2 million, representing 34% of the US$3,142.2 million the country received during that period, according to figures from the Central Bank. Total investment reaches more than 15 sectors in the country, including commerce, telecommunications, oil and mining, finance, manufacturing, electricity, gas and water, construction, and agriculture, among others.
By Diana Delgado
- Coffee
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