December arabica coffee (KCZ25) on Tuesday closed down -5.45 (-1.44%), and November ICE robusta coffee (RMU25) closed up +40 (+0.86%).
Coffee prices on Tuesday settled mixed. Harvest pressures in Brazil weighed on arabica prices after Brazil’s Cooxupe coffee co-op announced Tuesday that the harvest among its members was 91.3% complete as of August 22. Cooxupe is Brazil’s largest coffee cooperative and Brazil’s largest exporter group. Separately, Safras & Mercado reported last Friday that Brazil’s overall 2025/26 coffee harvest was 99% complete as of August 20, ahead of the comparable level of 98% last year. The breakdown showed that 100% of the robusta harvest and 98% of the arabica harvest were complete as of August 20.
Coffee prices saw support Tuesday from tighter inventories. ICE robusta coffee inventories fell to a 1-month low of 6,614 lots on Tuesday. Also, ICE-monitored arabica inventories fell to a 1.25-year low of 717,113 bags on Tuesday.
Coffee prices have rallied sharply over the past four weeks, reaching a 3.5-month high on Monday, due to concerns about weather conditions in Brazil. Somar Meteorologia reported Monday that Brazil’s largest arabica coffee-growing area, Minas Gerais, received no rain during the week ended August 23. Reports of damage to some of Brazil’s coffee crop from last week’s frost are also boosting prices.
Coffee prices also have support due to concerns about tighter US coffee supplies, as American buyers are voiding new contracts for purchases of Brazilian coffee beans because of the 50% tariffs imposed on Brazilian exports to the US. This is tightening the coffee supply in the US market, as about a third of unroasted coffee comes from Brazil.
Reduced exports from Brazil are supporting prices. On August 6, Brazil’s Trade Ministry reported that Brazil’s July unroasted coffee exports fell -20.4% y/y to 161,000 MT. In related bullish news released last Wednesday, Brazil’s green coffee exports in July fell -28% y/y to 2.4 million bags, according to exporter group Cecafe. Cecafe reported that July arabica exports fell -21% y/y, while robusta exports plunged -49% y/y. Cecafe said Brazil’s July coffee exports fell -28% to 2.7 million bags, and that coffee shipments during Jan-July fell -21% to 22.2 million bags.
As a bearish factor, the International Coffee Organization (ICO) reported August 6 that global June coffee exports rose +7.3% y/y to 11.69 million bags. However, cumulative Oct-Jun coffee exports were down -0.2% y/y at 104.14 million bags.
Due to drought, Vietnam’s coffee production in the 2023/24 crop year decreased by -20% y/y to 1.472 MMT, the smallest crop in four years. Also, Vietnam’s General Statistics Office reported that 2024 Vietnam coffee exports fell by -17.1% y/y to 1.35 MMT. Additionally, the Vietnam Coffee and Cocoa Association reduced its 2024/25 Vietnam coffee production estimate to 26.5 million bags on March 12, down from a December estimate of 28 million bags. By contrast, the Vietnam National Statistics Office reported last Tuesday that Vietnam’s Jan-Jul 2025 coffee exports were up +6.9% y/y to 1.05 MMT.
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.
