Coffee Market Update
As of today, Arabica Coffee for March is down by 10.45, or 2.70%, while January ICE Robusta Coffee has dropped 47, which amounts to a 1.03% decrease.
Today’s decline in coffee prices can be attributed to anticipated rains in Brazil, which are expected to enhance crop development and could lead to lower prices. Climatempo has forecasted heavy rain across the coffee-growing regions in Brazil over the weekend and into the upcoming week.
Just recently, coffee prices rose for a couple of days due to the significant U.S. tariffs on Brazilian coffee. Although the Trump administration had lifted some tariffs last Friday on non-U.S. goods, including coffee, only a small fraction—10%—of these tariffs were lifted. A more substantial 40% tariff, which was implemented due to a “national emergency” linked to former President Jair Bolsonaro’s indictment, remains imposed on Brazilian coffee exports to the U.S. There’s still uncertainty on whether U.S. importers will get an exemption on this hefty tariff.
Additionally, reduced coffee stocks at ICE are contributing to the pricing dynamics. Tariffs on imported Brazilian coffee have led to a dramatic drop in these stocks. As of Tuesday, Arabica inventory at ICE stood at 396,513 bags—its lowest in 1.75 years. Meanwhile, Robusta coffee inventory hit a four-month low of 5,648 lots on Monday. Given that a substantial portion of the U.S.’s unroasted coffee comes from Brazil, these tariffs are forcing U.S. buyers to back out of new purchase contracts, tightening supply further. Between August and October, following the implementation of tariffs, the U.S. imported only 983,970 bags of Brazilian coffee, a 52% slump compared to last year.
But not all news is grim. On Monday, meteorology reports from Somar indicated that Minas Gerais, Brazil’s primary Arabica coffee-producing area, received 19.8 mm of rain for the week ending November 14, which is about 42% of the historical average.
On a more cautionary note, StoneX projected last Wednesday that Brazil’s coffee production for the 2026/27 marketing year could reach 70.7 million bags, including 47.2 million bags of Arabica, marking a 29% increase year-on-year.
Price pressure is also on the rise due to increased coffee supplies from Vietnam. Vietnam’s exports from January to October 2025 increased by 13.4%, reaching 1.31 million metric tons, according to a report from Vietnam’s National Bureau of Statistics. There are forecasts of a 6% production increase in Vietnam’s 2025/26 crop to about 1.76 million metric tons, which translates to 29.4 million bags—the highest output in four years. The Vietnam Coffee and Cocoa Association mentioned that if conditions permit, production could rise by 10% from the previous year. Vietnam is currently the leading producer of Robusta coffee globally.
Some signs of a tighter global coffee supply may be helping prices hold firm, as the International Coffee Organization (ICO) reported a slight decline—0.3%—in global coffee exports for the current marketing year, totaling 138.7 million bags.
Supporting this sentiment, Brazil’s harvest forecasting agency, Conab, reduced its expectations for the 2025 Arabica harvest to 35.2 million bags, down 4.9% from earlier estimates. The total forecast for Brazilian coffee production in 2025 now stands at 55.2 million bags, slightly down from 55.7 million bags expected earlier.
Lastly, the USDA Foreign Agriculture Service (FAS) projected on June 25 that global coffee production would hit a record 178.68 million bags in 2025/26, a year-on-year increase of 2.5%. Specifically, Arabica coffee production may dip by 1.7% to 97.022 million bags, while Robusta production could rise by 7.9% to 81.658 million bags. Brazil’s production is expected to slightly increase to 65 million bags, while Vietnam’s output could reach 31 million bags, marking a notable peak.
