On Wednesday, May arabica coffee (KCK26) rose by +13.40 (+4.64%) and May ICE robusta coffee (RMK26) increased by +82 (+2.37%), reaching 3.5-week highs. This surge is attributed to concerns over a prolonged US-Iran conflict that may disrupt global shipping and coffee supplies through the Strait of Hormuz.
Robusta coffee inventories fell to a 16-month low of 3,755 lots, contributing to bullish sentiments about robusta prices. In contrast, Brazilian coffee exports dropped significantly, with March exports declining -10% y/y to 2.65 million bags, suggesting a tightening of supplies that may influence coffee market dynamics.
Meanwhile, Vietnam’s coffee exports rose by +14% y/y to 585,000 MT for January-March 2026. Projections for Brazil’s coffee production in 2025/26 indicate a decline of -3.1% y/y to 63 million bags, juxtaposed with an expected increase in Vietnamese production to a four-year high of 30.8 million bags.
