Arabica coffee prices surged on Friday, with September arabica coffee (KCU26) closing up +13.90 (+4.32%) at a one-week high, while September ICE robusta coffee (RMU26) fell -11 (-0.29%). This price increase follows a decline in the dollar index ($DXY) to a 7-week low and a tightening supply of arabica, which saw ICE-monitored inventories drop to a 2.5-year low of 244,172 bags.
Brazil’s coffee harvest remains behind last year’s pace, with the Cooxupe co-op reporting a completion rate of 67.3% as of July 31, compared to 74.2% in 2022. The USDA’s forecast for the 2026-27 season anticipates a 6% increase in global coffee output to a record 189.7 million bags, driven by improved conditions in Brazil, despite potential adverse effects from El Niño on future crop yields.
Meanwhile, Vietnam’s coffee exports saw a significant rise, with a 21.1% year-over-year increase for 2026, totaling 1.31 million metric tons (MMT). This increase poses downward pressure on robusta prices as robusta inventories rose to a 4.5-month high of 4,261 lots.
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