Arabica coffee prices increased by 1.18% to close at $4.20 on Tuesday, while robusta coffee rose by 0.92% to $36 amid concerns over potential supply shortages due to excessive dryness in Brazil, the leading arabica producer. The latest data from Somar Meteorologia indicates that Brazil’s Minas Gerais region received only 29% of its historical average rainfall for the week ending January 9.
ICE arabica coffee inventories, which previously dropped to a 1.75-year low of 398,645 bags, saw a recovery to 461,829 bags last week. Conversely, robusta inventories fell to a 1-year low of 4,012 lots and later rebounded to 4,278 lots. Meanwhile, coffee exports from Vietnam surged by 17.5% year-over-year, reaching 1.58 million metric tons, potentially exerting downward pressure on robusta prices.
The USDA’s December 18 report projects a 2% increase in global coffee production for 2025/26, totaling 178.848 million bags, with robusta production anticipated to rise by 10.9% to 83.333 million bags. In contrast, Brazilian arabica output is forecasted to decrease by 3.1% to 63 million bags.
