On Wednesday, March arabica coffee closed up $1.60 (+0.43%), reaching a four-week high, while March ICE robusta coffee fell $0.68 (-1.70%). The mixed settlement in coffee prices is primarily driven by below-average rainfall in Brazil, where the key growing region of Minas Gerais received only 47.9 mm of rain during the week ending January 2, 2023, or 67% of the historical average. Brazil’s coffee production forecast for 2025 was recently raised by Conab to 56.54 million bags, a 2.4% increase from prior estimates.
Conversely, robusta coffee prices are under pressure from a significant increase in Vietnamese coffee exports, projected to rise by 17.5% in 2025 to 1.58 million metric tons. The USDA’s Foreign Agriculture Service has projected global coffee production for 2025/26 to reach a record 178.848 million bags, although it expects a decline in Brazil’s arabica production by 3.1% to 63 million bags and an increase in Vietnam’s output to 30.8 million bags.
Currently, ICE-monitored arabica inventories have rebounded to a 2.5-month high of 461,829 bags, while robusta inventories increased to 4,278 lots, marking a 5-week high. U.S. imports of Brazilian coffee dropped 52% from August through October, totaling 983,970 bags, as high tariffs previously discouraged purchases.
