December arabica coffee (KCZ26) closed down -3.90 (-1.34%) on Thursday, and November ICE robusta coffee (RMX26) closed up +82 (+2.36%).
Coffee prices are mixed today, with arabica falling to a 7-week low and robusta climbing to a 1.5-week high. Arabica coffee prices fell Thursday amid projections from the International Coffee Organization (ICO) for a record global coffee crop and a surplus. The ICO projects 2025/26 global coffee production will climb +4.4% y/y to a record 183.6 million bags and consumption will fall -0.9% y/y to 180.6 million bags, leaving the global coffee market in a 3 million bag surplus, the first surplus in five years.
The end of Brazil’s coffee harvest is boosting arabica supplies and also weighing on prices. On Tuesday, Brazil’s Trade Ministry reported Brazil’s Aug coffee exports rose +44.6% y/y to 206,618 MMT, the most in 8 months.
Also, above-normal rainfall in Brazil may benefit flowering for next year’s coffee harvest, a bearish factor for prices. Somar Meteorologia reported last Monday that 8.9 mm of rain, or 127% of the historical average, fell in the week ended August 30 in Brazil’s Minas Gerais, the country’s main arabica-coffee growing region.
Robusta coffee has support from concern that heavy rains in Vietnam’s Central Highlands, the country’s largest coffee-producing region, may flood farms and damage the country’s coffee crop.
Last Thursday, robusta fell to a 3-month low on signs of bigger coffee supplies from Vietnam, the world’s largest producer of robusta coffee. Vietnam’s National Statistics Office reported last Wednesday that Vietnam’s 2026 coffee exports (Jan-Aug) rose by +13.7% y/y to 1.33 MMT. Vietnam’s 2025 coffee exports jumped by +17.5% y/y to 1.58 MMT. Also, Vietnam’s 2025/26 coffee production is projected to climb +6% y/y to a 4-year high of 1.76 MMT (29.4 million bags).
Falling inventories are bullish for arabica coffee prices, as ICE arabica coffee inventories fell to a 27-year low of 218,467 bags on Thursday. By contrast, rising inventories are bearish for robusta coffee as ICE robusta inventories climbed to a 9.25-month high of 5,004 lots last Wednesday.
Concerns that an El Niño weather pattern could hurt Brazil’s coffee crop next year are bullish for prices. Coffee trader Commercial said the El Niño weather pattern may delay rains in Brazil this September and October, when tree flowering normally occurs, hurting Brazil’s 2026/27 coffee crop. On July 8, the US Climate Prediction Center said the El Niño weather pattern that emerged across the equatorial Pacific last month will likely be one of the strongest in more than 75 years. This sets the stage for months of possible floods, droughts, and temperature fluctuations later this year that could hinder coffee production in Asia and South America.
The latest USDA biannual forecast was bearish for coffee prices. On July 22, the USDA forecast that global coffee output in the 2026-27 season will rise by +6.0% (10.8 million bags) to a record 189.7 million bags, mainly due to improved growing conditions in Brazil. The USDA expects global arabica production to rise +12% y/y, although robusta production is expected to fall by -0.7% y/y. World ending stocks are expected to rise +1.9 million bags to 26.3 million bags. On June 3, the USDA’s Foreign Agricultural Service (FAS) forecast a record 2026/27 Brazil coffee crop of 71.9 million bags, up +14% y/y.
