Coffee Futures Experience Short Covering Amidst Dollar Decline

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**Coffee Prices See Recovery on Market Fluctuations**

On Friday, July arabica coffee closed up by 0.30% to $0.85 per pound, while July ICE robusta coffee rose 0.09% to $3.00 per ton. This recovery followed a decline to 1.5-week lows, driven by a drop in the dollar index to a two-week low which prompted short covering in coffee futures.

Forecasts show a significant increase in Brazilian coffee production, with the Coffee Trading Academy projecting a 12% year-over-year increase to 71.4 million bags for the 2026/27 harvest. Recent estimates from Marex Group suggest a record crop of 75.9 million bags, eclipsing earlier predictions. Conversely, tight current arabica supplies, indicated by falling inventories to a two-month low of 494,508 bags, are exerting upward pressure on prices.

In related developments, robusta coffee exports from Vietnam surged by 14% year-over-year to 585,000 metric tons in the first quarter of 2026, further influencing market dynamics. The International Coffee Organization reports a slight decline in global coffee exports for the current marketing year, down 0.3% to 138.658 million bags, adding another layer to the pricing landscape.

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