Coffee Market Update
On Wednesday, Arabica Coffee for March closed up by 2.95, or 1.04%, while ICE Robusta Coffee for the same month rose by 53, or 1.44%.
After an earlier dip, coffee prices managed to recover and finish higher. Arabica, in particular, bounced back from a 7.25-month low. This uptick is attributed to technical short covering as recent downturns pushed prices deep into oversold territory.
For the past three weeks, coffee prices faced downward pressure, largely due to expectations of a record Brazilian coffee harvest. Arabica dipped to a 7.25-month low on Wednesday, while Robusta reached its own six-month low the day before. On February 5, Brazil’s coffee harvest agency, Conab, projected a 17.2% increase in coffee production for 2026, reaching 66.2 million bags. Notably, Arabica production is expected to rise by 23.2% to 44.1 million bags, and Robusta will increase by 6.3% to 22.1 million bags.
Additionally, good rainfall in Brazil has enhanced the outlook for coffee production. Minas Gerais, the leading region for Arabica, received 72.6 mm of rain in the week ending February 6, which is 113% of its historical average.
Robusta prices remain under pressure, influenced by a surge in coffee exports from Vietnam, the largest robusta producer in the world. On February 6, Vietnam’s National Bureau of Statistics revealed that coffee exports from the country rose to 198,000 tons, marking a 38.3% increase from the previous year. In 2025, Vietnam’s total coffee exports reached 1.58 million metric tons, up 17.5% from the prior year.
The rising supply of Vietnamese coffee is likely to weigh on Robusta prices. For the 2025/26 season, Vietnam’s coffee production is anticipated to increase by 6% year-on-year to 1.76 million metric tons, equating to about 29.4 million bags—the highest output in four years.
It’s worth noting that the recovery of stocks monitored by ICE could have a negative impact on coffee prices. Although Arabica stocks hit a 1.75-year low on November 18 at 396,513 bags, they rebounded to a 3.25-month high of 461,829 bags on January 7. ICE Robusta coffee inventories dropped to a 13-month low of 4,012 lots on December 10, but have since climbed to 4,662 lots, the highest in two months.
On a more positive note, Brazil’s Ministry of Trade reported a sharp decline in coffee exports for January, which fell by 42.4% year-on-year to 141,000 tons.
Meanwhile, low production from Colombia, the second-largest Arabica producer globally, is also lending support to prices. The National Coffee Producers Federation indicated that production in January decreased by 34% year-on-year to 893,000 bags.
There are emerging signs that global coffee supplies may be tightening, with the International Coffee Organization stating that global coffee exports for the current market year (from October to September) fell by 0.3% year-on-year to 138,658,000 bags.
The USDA’s Foreign Agricultural Service released a semi-annual report on December 18, projecting a 2.0% increase in global coffee production for the 2025/26 year, reaching a total of 178,848,000 bags. While overall production is set to rise, Arabica production is expected to decline by 4.7% to 95,515,000 bags. In contrast, Robusta production is anticipated to grow by 10.9% to 83,333,000 bags. The report forecasts a 3.1% decrease in Brazil’s coffee production for 2025/26, down to 63 million bags, while Vietnam’s production is set to increase to 30.8 million bags, the highest in four years. Ending stocks for 2025/26 are projected to fall by 5.4% to 20.148 million bags.
