December arabica coffee (KCZ25) today is down -5.30 (-1.32%), and January ICE robusta coffee (RMF26) is down -157 (-3.62%).
Coffee prices are falling for a third day today and posted 2-week lows on the potential for US tariff cuts. On Wednesday, Treasury Secretary Bessent said that there would be “substantial announcements over the next couple of days” on crops not grown in the US, including coffee.
Also undercutting coffee prices was Wednesday’s projection from StoneX, in its first forecast for the 2026/27 season, that Brazil will produce 70.7 million bags of coffee, including 47.2 million bags of arabica, a +29% y/y increase.
Recent rainfall in Brazil has eased concerns about dryness. Somar Meteorologia reported Monday that Brazil’s largest arabica coffee-growing area, Minas Gerais, received 72.1 mm of rain during the week ended November 7, or 160% of the historical average.
Increased Vietnamese coffee supplies are bearish for prices. The Vietnam National Statistics Office reported last Thursday that Vietnam’s Jan-Oct 2025 coffee exports rose +13.4% y/y to 1.31 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. In addition, the Vietnam Coffee and Cocoa Association (Vicofa) said on October 24 that Vietnam’s coffee output in 2025/26 will be 10% higher than the previous crop year if weather conditions remain favorable. Vietnam is the world’s largest producer of robusta coffee.
Shrinking ICE coffee inventories are also supportive of prices. 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 1.75-year low of 403,430 on Thursday, and ICE robusta coffee inventories fell to a 3.75-month low of 5,723 lots today. 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. US purchases of Brazilian coffee from August through October, during which President Trump’s tariffs took effect, dropped by 52% from the same period last year to 983,970 bags.
Signs of tighter global coffee supplies are supportive of prices, as the International Coffee Organization (ICO) reported on Monday that global coffee exports for the current marketing year (Oct-Sep) fell 0.3% y/y to 138.658 million bags.
Coffee prices garnered support after the National Oceanic and Atmospheric Administration (NOAA) on September 16 increased the likelihood to 71% of a La Niña weather system in the southern hemisphere from October to December, 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.
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.
