Coffee futures remained under pressure on Tuesday, extending the previous session’s losses as a weaker Brazilian real, rising export volumes and expectations of larger global supplies weighed on market sentiment. December 2026 New York arabica coffee fell to a seven-week low, settling at 274.20 cents per pound, down 2.20 cents or 0.80%. January 2027 London robusta declined by $17, or 0.52%, to $3,262 per tonne.
The Brazilian real tumbled to a 15-month low against the US dollar, increasing the incentive for Brazilian exporters to sell coffee into international markets. Expectations of stronger Brazilian exports have also intensified following a 23% year-on-year increase in October shipments.
However, the market remains supported by relatively tight certified arabica inventories and concerns about potential weather disruption from a developing Super-El Niño. The combination of stronger near-term supply and longer-term production risks continues to create a divided outlook across the coffee market.
Market Snapshot
| Market Indicator | Latest Data |
|---|---|
| December 2026 NY Arabica | 274.20 cents/lb |
| Arabica Daily Change | -2.20 cents (-0.80%) |
| January 2027 London Robusta | $3,262/tonne |
| Robusta Daily Change | -$17 (-0.52%) |
| Brazilian Real | 15-month low against USD |
| Brazil October Coffee Exports | 287,000 tonnes |
| Brazil Export Growth | +23% year-on-year |
| Brazilian Coffee Awaiting ICE Grading | 104,370 bags |
| ICE Arabica Inventories | 220,379 bags |
| ICE Robusta Inventories | 6,642 lots |
| Vietnam October Exports | 114,000 tonnes |
| ICO 2025/26 Global Production | 183.6 million bags |
Current Coffee Price Action
Arabica and robusta futures extended their declines, with New York arabica reaching its lowest level in seven weeks.
The Brazilian real’s weakness has become a significant influence on the market. As Brazil is the world’s largest coffee producer and exporter, accounting for approximately 35–40% of global production and nearly 30% of exports, currency movements can have a substantial effect on international supply.
A weaker real allows Brazilian exporters to receive more local currency for dollar-denominated sales, encouraging export activity and potentially increasing the availability of coffee in international markets.
The latest decline also reflects growing expectations that Brazilian coffee supplies will increase, particularly as additional shipments arrive at ICE warehouses and await grading.
Brazilian Real Weakness and Export Pressure
The Brazilian currency has fallen to a 15-month low against the US dollar, creating a more favourable environment for Brazilian coffee exporters.
The depreciation follows political developments surrounding President Luiz Inácio Lula da Silva’s recent election victory, which has contributed to the currency’s weakness.
Brazil’s Trade Ministry reported that October coffee exports increased by 23% year-on-year to 287,000 tonnes.
The increase reinforces expectations of stronger export availability and adds to the bearish pressure on both arabica and robusta futures.
Brazil’s importance to the global coffee market means continued currency weakness could encourage further selling, particularly if international prices remain attractive to local producers.
Brazilian Coffee Arrivals Increase at ICE Warehouses
Growing volumes of Brazilian coffee awaiting grading at ICE warehouses are another important source of market pressure.
ICE reported that 104,370 bags of Brazilian coffee were awaiting grading as of Tuesday, the highest level in eight months.
Once coffee passes the grading process, it can be added to certified warehouse inventory figures. The process typically takes one to two weeks, although larger volumes can extend the waiting period.
Brazilian coffee has been arriving rapidly at ICE warehouses since mid-September. Certified inventories of Brazilian coffee reached a 14-month high of 103,457 bags on Monday.
The potential conversion of these awaiting stocks into certified inventories could increase the supply available against exchange-traded contracts, adding further pressure to prices.
Global Coffee Inventories: Arabica and Robusta Diverge
Exchange inventory conditions remain an important factor supporting the longer-term coffee outlook, particularly for arabica.
ICE arabica inventories fell to 220,379 bags, a seven-week low. This remains only modestly above the 27-year low of 217,646 bags recorded on September 15.
Although Brazilian coffee is arriving at ICE warehouses, much of it has yet to appear in significant quantities in certified stock figures.
Robusta inventories have followed a different trend. ICE robusta stocks increased sharply from early October, reaching a 1.25-year high of 6,809 lots on October 29, before easing to 6,642 lots on Tuesday.
The divergence suggests that arabica remains relatively tight in certified warehouse availability, while robusta has benefited from improving inventory levels.
Vietnam Coffee Exports Surge
Higher Vietnamese coffee exports are adding further pressure to the robusta market.
Vietnam’s National Statistics Office reported that October coffee exports increased by 61% year-on-year to 114,000 tonnes.
Total exports between January and October reached 1.57 million tonnes, representing an 18.8% increase compared with the same period last year.
Vietnam’s 2025 coffee exports increased by 17.5% to 1.58 million tonnes.
Production expectations are also improving, with Vietnam’s 2025/26 coffee crop projected to increase by 6% year-on-year to a four-year high of 1.76 million tonnes, equivalent to approximately 29.4 million bags.
As the world’s largest robusta producer, Vietnam’s export performance is particularly important for London coffee futures.
The substantial increase in shipments and improving production outlook are providing a bearish supply signal for robusta.
Brazil and Vietnam Crop Conditions
Growing conditions across Brazil and Vietnam remain generally supportive of production prospects, although weather risks could change the outlook.
Somar Meteorologia reported that Brazil’s Minas Gerais region received 29.6 mm of rainfall during the week ending October 25, equivalent to 82% of the historical average.
Above-normal rainfall during the critical flowering period could support the development of Brazil’s 2026/27 coffee crop.
In Vietnam, recent abundant rainfall has improved soil moisture levels across the Central Highlands, the country’s largest coffee-producing region. Improved moisture conditions are expected to support coffee cherry development.
These favourable growing conditions are adding to expectations of stronger future production.
However, the developing Super-El Niño remains a significant risk. Vietnam’s Agriculture Ministry has warned that the Central Highlands could face El Niño-related drought later this year and into early 2027.
If rainfall becomes insufficient during critical growing stages, production prospects could deteriorate.
Brazil Production Forecast Revised Higher
Brazil’s crop outlook continues to weigh on coffee prices.
Conab, Brazil’s agricultural forecasting agency, raised its 2026 coffee production estimate to 67.6 million bags from 66.7 million bags.
Arabica production is expected to increase by 34.8% year-on-year to 48.21 million bags, while robusta production is forecast to decline by 6.6% to 19.39 million bags.
The expected recovery in arabica production is particularly significant for New York futures, as Brazil remains the dominant global supplier.
The higher production estimate reinforces expectations that international availability could improve as the next Brazilian crop enters the market.
Colombia Production Declines
Colombia’s latest production and export figures provide some support to the arabica market.
The Colombian Coffee Federation reported that 2025/26 coffee production fell by 15% year-on-year to 12.65 million bags.
Exports also declined by 12% to 11.78 million bags.
Colombia is the world’s second-largest arabica producer, making its output an important influence on international arabica availability.
The decline in Colombian production contrasts with Brazil’s expected recovery and could help limit the extent of any increase in global arabica supplies.
Global Coffee Supply and Demand Outlook
The International Coffee Organization’s outlook remains bearish for the broader coffee market.
The ICO projected that global coffee production in 2025/26 increased by 4.4% year-on-year to a record 183.6 million bags.
Global consumption was forecast to decline by 0.9% to 180.6 million bags, leaving the market with a surplus of approximately 3 million bags. This would represent the first global surplus in five years.
The USDA’s 2026/27 forecast also points towards further production growth.
Global output is expected to increase by 6% to a record 189.7 million bags, supported primarily by improved growing conditions in Brazil.
Arabica production is forecast to rise by 12% year-on-year, while robusta production is expected to decline by 0.7%.
Global ending stocks are projected to increase by 1.9 million bags to 26.3 million bags.
The USDA has also forecast a record Brazilian coffee crop of 71.9 million bags in 2026/27, representing a 14% annual increase.
These projections reinforce the possibility of a more comfortable global supply balance, although weather-related production risks remain an important uncertainty.
Bullish Sentiment for Coffee
- Tight arabica inventories: ICE arabica stocks remain near historically low levels at 220,379 bags.
- Potential El Niño disruption: A strong El Niño could bring drought conditions to Brazil and Vietnam, threatening future production.
- Vietnam drought concerns: The Central Highlands could face reduced rainfall later this year and into early 2027.
- Lower Colombian production: Colombia’s 2025/26 output declined 15% to 12.65 million bags.
- Robusta short positioning: Funds increased net-short robusta positions by 4,767 contracts to 16,968 in the week ended November 3, creating potential for short-covering rallies.
- Arabica supply tightness: Brazilian arrivals have not yet translated into a comparable increase in ICE-certified arabica stocks.
Bearish Sentiment for Coffee
- Weak Brazilian real: The currency’s 15-month low encourages exporters to sell more coffee internationally.
- Higher Brazilian exports: October shipments increased 23% year-on-year to 287,000 tonnes.
- Growing ICE grading volumes: Brazilian coffee awaiting grading reached 104,370 bags, the highest level in eight months.
- Rising Vietnam exports: October shipments increased 61% year-on-year to 114,000 tonnes.
- Improving Brazilian crop outlook: Conab raised its 2026 production estimate to 67.6 million bags.
- Favourable growing conditions: Rainfall in Brazil and Vietnam is supporting crop development.
- Global surplus forecast: The ICO expects a 3-million-bag surplus in 2025/26, while the USDA projects record global production in 2026/27.
Coffee Price Forecast: What Traders Are Watching
The immediate outlook remains sensitive to Brazilian currency movements, export volumes and the pace at which coffee awaiting grading enters ICE-certified inventories.
For arabica, the key question is whether historically low certified stocks can provide sufficient support against expectations of a significantly larger Brazilian crop.
For robusta, Vietnam’s rising exports and improving production prospects remain the dominant bearish influences. However, the substantial short positioning held by investment funds could increase the potential for a sharp recovery if prices begin to move higher.
Weather developments will remain important for both markets. Any evidence that El Niño is disrupting rainfall during critical crop-development periods could rapidly change production expectations.
Global Coffee Supply Outlook
The global supply outlook is becoming more comfortable, particularly with Brazil expecting a substantial recovery in arabica production and Vietnam reporting stronger exports.
However, the expected increase in production is not uniform. Brazilian robusta output is forecast to decline, while Colombian arabica production has also weakened.
ICE inventory levels provide another important distinction. Arabica stocks remain historically tight, while robusta inventories have improved considerably.
The potential impact of El Niño could also undermine current production forecasts if drought conditions emerge across major growing regions.
Global Coffee Demand Outlook
Global demand remains a concern, particularly following the ICO’s projection of lower consumption in 2025/26.
The expected increase in global production to record levels during 2026/27 could place additional pressure on prices if consumption fails to keep pace.
However, the relatively tight arabica inventory position and the possibility of weather-related supply disruption could prevent the market from becoming excessively oversupplied.
Demand performance, particularly across major consuming markets, will remain an important indicator for determining whether the projected global surplus can be sustained.
Market Outlook for the Coming Sessions
Coffee futures remain under pressure as a weaker Brazilian real, stronger exports and improving production expectations reinforce the prospect of greater global availability.
The immediate bearish outlook is particularly evident in robusta, where Vietnamese export growth and rising inventories are weighing on prices. Arabica faces similar pressure from Brazil’s improving crop prospects, although historically low certified stocks provide an important source of support.
For the coming sessions, traders will monitor Brazilian currency movements, ICE grading activity, Vietnamese exports and rainfall across major producing regions.
The central question is whether the expected increase in global production will outweigh tight certified arabica inventories and the growing risk of El Niño-related weather disruption.
Until supply conditions become clearer, coffee markets are likely to remain sensitive to export data, inventory changes and weather developments.
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Disclaimer: This article is provided for informational and market commentary purposes only. It does not constitute investment advice, financial advice or a recommendation to buy or sell any financial instrument. Commodity futures involve significant risk and may not be suitable for all investors. Readers should conduct their own research and consider their financial circumstances before making trading decisions.
