September arabica coffee (KCU25) on Monday closed down -11.35 (-3.92%), and September ICE robusta coffee (RMU25) closed down -151 (-4.11%).
Coffee prices sold off sharply on Monday, with Sep arabica coffee posting a contract low, and the July (N25) nearest-futures contract dropping to a 7.5-month low. Sep robusta prices fell to a 1-week low.
The advancing coffee harvest in Brazil is weighing on coffee prices. Brazil’s Cooxupe coffee co-op announced last Wednesday that its members reported the coffee harvest was 31% complete as of June 27, compared with 42% completed at the same time last year. Cooxupe is Brazil’s largest coffee cooperative and Brazil’s largest exporter of coffee.
Also, Safras & Mercado recently reported that Brazil’s 2025/26 coffee harvest was 35% complete as of June 11, slightly behind last year’s comparable level of 37% but in line with the 5-year average of 35%. The breakdown showed that 49% of the robusta harvest and 26% of the arabica harvest were complete as of June 11.
Losses in robusta coffee accelerated Monday after Vietnam’s National Statistics Office reported that Vietnam’s 2025 Vietnam’s Jan-Jun coffee exports are up +4.1% y/y to 943,000 MT.
Coffee prices have retreated over the past two months as the outlook for abundant coffee supplies undercut prices. On June 25, the USDA’s Foreign Agricultural Service (FAS) forecasted that Brazil’s 2025/26 coffee production will increase by 0.5% year-over-year (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. Brazil is the world’s largest producer of arabica coffee, and Vietnam is the world’s largest producer of robusta coffee.
Below-normal rainfall in Brazil is supportive for coffee prices. Somar Meteorologia reported today that Brazil’s largest arabica coffee-growing area, Minas Gerais, received no rain during the week ended July 5.
Robusta coffee prices have support as ICE-monitored robusta coffee inventories declined to a 7-week low of 5,108 lots on June 26, although inventories have since rebounded higher to 5,131 lots as of Monday. However, a bearish factor for arabica prices is that ICE-monitored arabica coffee inventories rose to a 5-month high of 892,468 bags on May 27 and were moderately below that high at 833,695 bags as of Monday.
Smaller coffee exports from Brazil are bullish for prices. On June 25, Cecafe reported that Brazil’s May green coffee exports fell by -36% y/y to 2.8 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.
The USDA’s biannual report, released on June 25, was bearish for coffee prices. The USDA’s Foreign Agriculture Service (FAS) projected 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. The USDA’s 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.
For the 2025/26 marketing year, Volcafe projects 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.
