**Coffee Prices Surge Amid Supply Concerns**
On Monday, July arabica coffee closed up 2.73% at $7.50, while July ICE robusta coffee rose 2.64% or $0.90. This spike in prices is primarily driven by tight inventories; ICE arabica stocks hit a 2.5-month low at 477,045 bags, and robusta inventories fell to a 16.75-month low of 3,687 lots.
Disruptions in global coffee supply due to the ongoing closure of the Strait of Hormuz, which has raised shipping and import costs, are also impacting prices. Additionally, Brazil’s coffee exports dropped 10% year-on-year to 2.65 million bags in March, while Vietnam’s robusta exports surged 15.8% to 810,000 metric tons over the same period, further complicating the supply landscape. Projections indicate Brazil’s coffee production may rise by 12% year-on-year to 71.4 million bags for the 2026/27 cycle, adding to bearish factors for prices.
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