On Thursday, July arabica coffee (KCN26) closed up by 5.10 cents (+1.90%), while July ICE robusta coffee (RMN26) rose by 71 cents (+2.13%). The price increase is attributed to concerns that an El Niño weather pattern could adversely impact Brazil’s coffee crop for the 2026/27 season, with the NOAA forecasting an 82% chance of El Niño developing between May and July.
Brazil’s 2026/27 coffee harvest is projected to increase by 12% year-on-year to 71.4 million bags, according to the Coffee Trading Academy. However, current conditions may delay vital flowering rains needed in September and October. In contrast, Vietnam is reporting a surge in coffee exports, with a 15.8% year-on-year increase for the 2026 period, reaching 810,000 metric tons.
Coffee inventories at ICE have been trending lower, with robusta stocks recently falling to a two-year low of 3,631 lots before recovering to 3,924 lots, while arabica inventories hit a three-month low of 451,225 bags. Additionally, the ongoing closure of the Strait of Hormuz is creating supply disruptions, leading to higher global shipping costs.
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