Coffee prices surged to 4.75-month highs on Wednesday, with September arabica coffee closing up 4.54% to $13.45 and September robusta coffee rising 3.09% to $113. This increase is attributed to heavy rains in Brazil, particularly in the Minas Gerais region, where rainfall reached 31.3 mm last week, significantly above the historical average.
Concerns surrounding the coffee crop have intensified as Brazilian farmers delay sales, anticipating further price increases amid potential disruptions caused by this year’s El Niño. Additionally, ICE arabica coffee inventories fell to a 2.25-year low of 375,079 bags, while robusta inventories rose to a 2.75-month high of 4,053 lots. The NOAA estimates a 67% chance of a “Super El Niño,” forecasted to impact global coffee production significantly later this year.
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