December arabica coffee (KCZ25) today is down -7.25 (-1.77%), and November ICE robusta coffee (RMX25) is up +37 (+0.81%).
Coffee prices today are mixed after Thursday's sharp declines of -2.54% in NY arabica coffee and -3.90% in robusta coffee. Coffee prices have fallen back from Thursday's 8.3-month nearest-futures high in arabica coffee and 5-week high in robusta coffee.
Arabica coffee was undercut on Thursday after Climatempo forecasted weekend showers for Brazil's coffee-growing regions. Robusta coffee slumped on Thursday after Vietnam's weather office lowered the likelihood of heavy rains from Tropical Storm Fengshen in Vietnam's Central Highlands, the country's main coffee-producing region, reducing the risk of crop damage.
Robusta coffee is higher despite today's bearish forecast from the Vietnam Coffee and Cocoa Association (Vicofa) that Vietnam's coffee output in 2025/26 will be 10% higher than the previous crop year if weather conditions remain favorable.
Coffee prices remain underpinned by concern that excessive dry conditions in Brazil during the critical flowering period for coffee trees will threaten the 2026/27 coffee crop. According to the Bloomberg Brazil Weather Analysis, coffee-producing regions in Brazil have been experiencing an intense drought, with the state of Minas Gerais recording about 70% of its average rainfall for this period over the past month.
Coffee prices are also supported by shrinking ICE coffee inventories. The 50% tariffs imposed on US imports from Brazil have led to a sharp drawdown in ICE coffee inventories. ICE-monitored arabica inventories fell to a 19-month low of 465,910 bags on Wednesday, and ICE robusta coffee inventories fell to a 3-month low of 6,141 lots. American buyers are voiding new contracts for Brazilian coffee purchases due to the 50% tariffs on US imports from Brazil, thereby tightening US supplies, as about a third of America's unroasted coffee comes from Brazil.
Coffee prices also garnered support after the National Oceanic and Atmospheric Administration (NOAA) on September 16 increased the likelihood of a La Niña weather system in the southern hemisphere from October to December to 71%, which could bring excessive dry weather to Brazil and harm the 2026/27 coffee crop. Brazil is the world's largest producer of arabica coffee.
Hopes that 50% tariffs on Brazilian goods will soon be removed are negative for coffee prices. Last Thursday, US Trade Representative Greer said he and Secretary of State Rubio had "very positive talks" with Brazilian Minister of Foreign Affairs Vieira regarding trade. Both sides said they will schedule a meeting between President Trump and President Lulu at the earliest possible occasion.
Somar Meteorologia reported Monday that Brazil's largest arabica coffee-growing area, Minas Gerais, received 44.7 mm of rain during the week ended October 18, or 136% of the historical average.
Robusta coffee is also under pressure due to increased supplies from Vietnam. The Vietnam National Statistics Office reported last Monday that Vietnam's Jan-Sep 2025 coffee exports rose +10.9% y/y to 1.230 MMT. Also, Vietnam's 2025/26 coffee production is projected to climb +6% y/y to 1.76 MMT, or 29.4 million bags, a 4-year high. Vietnam is the world's largest producer of robusta coffee.
Larger coffee exports are bearish for prices after the International Coffee Organization (ICO) reported on October 6 that global coffee exports for the current marketing year (Oct-Aug) rose +0.2% y/y to 127.92 million bags, indicating adequate exports and supplies.
Coffee prices found support after Conab, Brazil's crop forecasting agency, cut its Brazil 2025 arabica coffee crop estimate on September 4 by -4.9% to 35.2 million bags from a May forecast of 37.0 million bags. Conab also reduced its total Brazil 2025 coffee production estimate by 0.9% to 55.2 million bags, from a May estimate of 55.7 million bags.
The USDA's Foreign Agriculture Service (FAS) projected on June 25 that world coffee production in 2025/26 will increase by +2.5% y/y to a record 178.68 million bags, with a -1.7% decrease in arabica production to 97.022 million bags and a +7.9% increase in robusta production to 81.658 million bags. FAS forecasted that Brazil's 2025/26 coffee production will increase by +0.5% y/y to 65 million bags and that Vietnam's 2025/26 coffee output will rise by 6.9% y/y to a 4-year high of 31 million bags. FAS forecasts that 2025/26 ending stocks will climb by +4.9% to 22.819 million bags from 21.752 million bags in 2024/25. However, Volcafe is projecting a global 2025/26 arabica coffee deficit of -8.5 million bags, wider than the -5.5 million bag deficit for 2024/25 and the fifth consecutive year of deficits.
