On Monday, September arabica coffee (KCU26) closed up +48.75 (+16.19%) and September ICE robusta coffee (RMU26) rose +328 (+8.83%), reaching a 5.5-month high for arabica and a 5-month high for robusta. The surge in coffee prices followed reports of a delayed coffee harvest in Brazil, which is currently only 52% complete as of July 1, compared to 60% last year and a five-year average of 55%.
Concerns over forthcoming rain forecasts from meteorologist Rural Clima, which may harm crops, alongside a rally in the Brazilian real to a 2-week high, have contributed to higher prices. Additionally, ICE arabica coffee inventories dropped to a 2.25-year low of 366,756 bags, intensifying concerns regarding supply, especially with a 67% probability forecast for a “Super El Niño” that could impact future yields.
In contrast, Vietnam’s robusta coffee exports for the first half of 2026 rose by +7.3% year-on-year to 1.05 million metric tons, indicating a bearish outlook for robusta prices. Meanwhile, USDA projects a record 2026/27 Brazil coffee crop of 71.9 million bags, a +14% increase year-on-year, underscoring the complexities of global coffee supply and demand dynamics.
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