March arabica coffee (KCH26) on Monday closed up +3.30 (+1.11%), and March ICE robusta coffee (RMH26) closed up +79 (+2.10%).
Coffee prices recovered from early losses on Monday and settled higher after the Brazilian real (^USDBRL) jumped to a 1-week high against the dollar, discouraging export sales from Brazil’s coffee producers.
Also, smaller coffee supplies from Colombia, the world’s second-largest arabica producer, gave prices a lift when Colombia’s National Federation of Coffee Growers reported that Colombia’s January coffee production fell -34% y/y to 893,000 bags.
Coffee prices initially moved lower on Monday, with arabica falling to a 6-month low, as concerns over dry conditions in Brazil eased further when Somar Meteorologia reported that Brazil’s largest arabica coffee-growing area, Minas Gerais, received 72.6 mm of rain during the week ended February 6, or 113% of the historical average.
Coffee prices have been under pressure over the past 1.5 weeks, with robusta falling to a 5.75-month low last Thursday on signs of robust coffee supplies. Conab, Brazil’s crop forecasting agency, said last Thursday that Brazil’s 2026 coffee production will climb +17.2% y/y to a record 66.2 million bags, with arabica production up +23.2% y/y to 44.1 million bags and robusta production up +6.3% y/y to 22.1 million bags.
Soaring coffee exports from Vietnam, the world’s largest robusta producer, are bearish for robusta prices. Vietnam’s National Statistics Office reported Friday that Vietnam’s Jan coffee exports surged +38.3% y/y to 198,000 MT. Vietnam’s 2025 coffee exports jumped by +17.5% y/y to 1.58 MMT.
Increased Vietnamese coffee supplies are negative for prices. 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.
The recovery in ICE coffee inventories is negative for prices. ICE-monitored arabica inventories fell to a 1.75-year low of 396,513 bags on November 18, but recovered to a 3.25-month high of 461,829 bags on January 7. Also, ICE robusta coffee inventories fell to a 13-month low of 4,012 lots on December 10 but recovered to a 2-month high of 4,662 lots on January 26.
On the positive side for coffee, Brazil’s Trade Ministry reported last Thursday that Brazil’s Jan coffee exports fell -42.4% y/y to 141,000 MT.
Signs of tighter global coffee supplies are supportive of prices, as the International Coffee Organization (ICO) on November 7 reported that global coffee exports for the current marketing year (Oct-Sep) fell -0.3% y/y to 138.658 million bags.
The USDA’s Foreign Agriculture Service (FAS) bi-annual report on December 18 projected that world coffee production in 2025/26 will increase by +2.0% y/y to a record 178.848 million bags, with a -4.7% decrease in arabica production to 95.515 million bags and a +10.9% increase in robusta production to 83.333 million bags. FAS forecasted that Brazil’s 2025/26 coffee production will decline by -3.1% y/y to 63 million bags and that Vietnam’s 2025/26 coffee output will rise by 6.2% y/y to a 4-year high of 30.8 million bags. FAS forecasts that 2025/26 ending stocks will fall by -5.4% to 20.148 million bags from 21.307 million bags in 2024/25.
