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On Wednesday, December arabica coffee (KCZ25) closed up +7.30 (+1.77%), while November ICE robusta coffee (RMX25) increased by +119 (+2.58%). Coffee prices have reached 5-week highs, supported by shrinking ICE inventories amid a 50% tariff on U.S. imports from Brazil. This has caused arabica inventories to drop to a 19-month low of 465,910 bags and robusta inventories to a 3-month low of 6,141 lots.
Concerns about coffee crop damage in Vietnam due to Tropical Storm Fengshen further buoyed prices, as the storm poses risks of flash floods and landslides in the Central Highlands. Additional forecasts from the NOAA suggest a 71% likelihood of a La Niña weather system from October to December, which could adversely impact Brazil’s coffee crop, the world’s largest producer of arabica coffee.
Despite these price supports, easing dry conditions in Brazil and increased coffee supplies from Vietnam—which reported a +10.9% year-over-year rise in Jan-Sep 2025 coffee exports—could pressure prices. The USDA projects world coffee production in 2025/26 will increase by +2.5% year-over-year to a record 178.68 million bags, with Brazil’s output growing by +0.5% to 65 million bags.
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