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Arabica coffee prices rose by +2.20 (+0.59%) for December contracts, while robusta coffee prices fell by -26 (-0.58%) for November contracts as of today. This mixed performance comes amid long liquidation pressures due to predicted rain in Brazil’s coffee-growing regions, beginning next week. The Brazilian real reached a 15-month high against the dollar, discouraging exports.
ICE-monitored arabica inventories declined to a 16.5-month low of 659,949 bags, and robusta inventories fell to a 1.75-month low at 6,517 lots. Tariffs on Brazilian imports have reduced US coffee supplies, impacting contract negotiations, as one-third of unroasted coffee in the US originates from Brazil. Reports indicated that Brazil’s July coffee exports fell -20.4% year-over-year to 161,000 MT, with significant declines in green coffee shipments.
Forecasts suggest a La Niña weather system could adversely affect Brazil’s coffee yields, with potential crop estimates down by -4.9% to 35.2 million bags for arabica in 2025. The USDA projects a slight overall increase in world coffee production for 2025/26, driven by robusta growth, although an ongoing deficit in arabica coffee supplies is expected.
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