Coffee Prices Surge Over Brazil Harvest Delays

July arabica coffee futures (KCN26) closed Monday up 5.75 cents, or 2.24%, while July ICE robusta coffee futures (RMN26) rose 13 cents, or 0.36%.

Coffee prices continued their rally on Monday, with arabica reaching a two‑week high and robusta a five‑week high. The market is being buoyed by worries that steady rain in Brazil will postpone the harvest. Forecaster Vaisala forecasts moderate to heavy rain across Brazil’s coffee‑growing areas this week.

ICE coffee inventories have been declining over the past three months, supporting price levels. Arabica stocks fell to a six‑month low of 398,940 bags on Friday. Robusta inventories reached a two‑year low of 3,631 lots on May 15, but rose modestly to 3,857 lots by Monday.

Expectations that an El Niño event could damage next year’s Brazilian coffee crop are underpinning prices. Trader Commercial notes that El Niño may suppress rainfall in Brazil during September and October, the period when flowering normally occurs, potentially affecting the 2026/27 harvest.

NOAA assigns a 67% chance that a “Super El Niño” will develop this year, possibly the most intense on record. The Japan Meteorological Agency confirmed an El Niño pattern across the equatorial Pacific last Wednesday. Such conditions are expected to bring prolonged floods, droughts and temperature swings later in the year, threatening coffee production in Asia and South America.

On Tuesday, arabica futures slipped to a 19‑month low and robusta to a two‑month low, as expectations grew for a bumper Brazilian harvest this year. The USDA Foreign Agricultural Service projects a record 2026/27 Brazilian coffee crop of 71.9 million bags, a 14% increase year‑over‑year. Rabobank lifted its estimate for a global arabica surplus in 2026/27 to 9.5 million bags, up from 7.0 million. Cecafe reported that Brazil’s May green coffee exports rose 4.2% year‑over‑year to 2.73 million bags.

Export volumes from Vietnam, the world’s leading robusta producer, are putting downward pressure on robusta prices. Vietnam’s National Statistics Office indicated that coffee exports for January‑May 2026 rose 7.9% year‑over‑year to 922,000 metric tons. In 2025, exports jumped 17.5% to 1.58 million metric tons. Projections show Vietnam’s 2025/26 coffee output will rise 6% to a four‑year high of 1.76 million metric tons (29.4 million bags).

The continued closure of the Strait of Hormuz is straining global coffee supplies and supporting higher prices. By tightening shipping routes, the closure drives up freight, insurance, fertilizer and fuel costs, which elevates expenses for coffee importers and roasters.

The International Coffee Organization disclosed on November 7 that global coffee exports for the current marketing year (October‑September) slipped 0.3% year‑over‑year to 138.658 million bags.

The USDA Foreign Agricultural Service’s December 18 bi‑annual report forecasts a 2.0% year‑over‑year rise in global coffee production for 2025/26, reaching a record 178.848 million bags. Arabica output is expected to dip 4.7% to 95.515 million bags, while robusta production will climb 10.9% to 83.333 million bags. Brazil’s 2025/26 coffee production is projected to fall 3.1% to 63 million bags, whereas Vietnam’s output is expected to increase 6.2% to a four‑year high of 30.8 million bags. Ending stocks are forecast to decline 5.4% to 20.148 million bags, down from 21.307 million bags in 2024/25.

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