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On Monday, December arabica coffee (KCZ25) closed down by 12.90 cents (-3.20%) at a price influenced by a recent meeting between Brazil’s President Luiz Inacio Lula da Silva and President Trump, which raised hopes for relief from US tariffs on Brazilian imports. Concurrently, November ICE robusta coffee (RMX25) fell by 134 cents (-2.93%) as expectations for increased coffee supply from Vietnam emerged.
ICE arabica coffee inventories decreased to a 1.5-year low of 447,773 bags last Friday but slightly increased to 450,743 bags on Monday. Meanwhile, ICE robusta coffee inventories reached a 3-month low of 6,122 lots. Vietnam’s coffee exports from January to September 2025 rose by 10.9% year-on-year to 1.230 million metric tons, contributing to bearish trends in robusta coffee prices.
Concerns persist regarding the impact of drought conditions in Brazil, with Minas Gerais experiencing only 70% of its average rainfall over the past month, which threatens the 2026/27 coffee crop. The USDA projected that world coffee production for 2025/26 will increase by 2.5% year-on-year to 178.68 million bags, including a 0.5% increase in Brazil’s output to 65 million bags.
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