Dubai, September 3, 2025 (Qahwa World) – While global coffee prices are falling due to heavy rainfall in Brazil and the near completion of the harvest, consumers in the world’s largest producer and exporter are facing the opposite reality: higher prices for roasted and instant coffee in the domestic market.
December arabica futures fell 3.44%, while November robusta dropped 3.28% to a one-week low. Weather data from Somar Meteorologia showed that Minas Gerais, Brazil’s largest arabica-producing region, received 10.1 mm of rain in the week ending August 30 – 163% of the historical average.
Meanwhile, Cooxupé, Brazil’s biggest coffee cooperative, reported that its members’ harvest was 94.9% complete as of August 29. Safras & Mercado confirmed that Brazil’s 2025/26 harvest was 99% finished by August 20, with robusta fully harvested and arabica 98% complete.
In contrast, roasters 3 Coracoes and Melitta announced fresh price hikes in Brazil starting September 1. 3 Coracoes raised roasted and ground coffee prices by 10% and instant coffee by 7%, while Melitta increased prices by 15%. These hikes follow earlier rises: 11% in January and 14.3% in March by 3 Coracoes, and a 25% increase by Melitta last December.
This creates a striking paradox in Brazil’s coffee market: while international prices are easing thanks to favorable weather and ample harvests, local consumers are paying more, driven by climate volatility, a 50% U.S. tariff on Brazilian coffee imports, and rising raw bean costs.
Global arabica prices have already climbed more than 20% this year after a 70% surge in 2024. With tariffs in place, U.S. roasters have been tapping existing stockpiles, adding further pressure.
The Brazilian Coffee Industry Association (ABIC) noted a brief drop in retail prices in August as futures eased from record highs, but warned that the trend would reverse once tariffs took effect — and that reversal is now underway. Major roasters are struggling to balance costs as consumers shift toward cheaper supermarket brands.
Looking ahead, the U.S. Department of Agriculture projects global coffee production to rise 2.5% in 2025/26 to a record 178.7 million bags. Yet trader Volcafe forecasts a widening global arabica deficit of 8.5 million bags — the fifth straight year of shortages. This contradiction — falling global prices alongside rising domestic costs in Brazil — sets the stage for continued turbulence in the coffee market.
