**Coffee Prices Decline Amid Supply Concerns**
On Wednesday, December arabica coffee (KCZ26) prices fell by 3.98%, closing down $13.35, while November ICE robusta coffee (RMX26) dropped 2.09%, down $77. This decline comes as Brazil’s coffee harvest is forecasted to improve supply, pressuring futures amid reports that most warehouses in Brazil are at capacity, forcing farmers to sell more coffee. As of August 21, Brazil’s Cooxupe co-op reported that 87.5% of the coffee harvest was complete, down from 91.3% last year.
Coffee inventories are showing contrasting trends: ICE arabica coffee stocks declined to a 2.75-year low of 224,617 bags, whereas robusta inventories climbed to a nine-month high of 4,943 lots. Additionally, the recent earthquake in Colombia, affecting coffee-growing regions, has resulted in limited yet ongoing coffee exports, adding further complexity to market dynamics. Concerns over potential impacts from the El Niño weather pattern may also affect Brazil’s future coffee production, contributing to price volatility in the market.
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