Dubai – Qahwa World
Coffee prices experienced a sharp decline on Monday, with arabica falling to a two-week low and robusta reaching a 2.25-month low. The downturn comes amid expectations of abundant global coffee supplies.
Brazil’s crop agency, Conab, recently raised its 2025 production forecast to 56.54 million bags, up from 55.20 million bags projected in September. Meanwhile, Vietnam’s National Statistics Office reported a 39% year-on-year increase in November coffee exports, reaching 88,000 metric tons, while January–November exports grew nearly 15% to 1.398 million metric tons.
Analysts at StoneX forecast that Brazil could produce 70.7 million bags in the 2026/27 marketing year, including 47.2 million bags of arabica—a 29% increase compared to the previous year.
The European Union’s recent one-year delay of its deforestation regulation (EUDR) is also influencing market sentiment. The measure, designed to curb deforestation in countries exporting key commodities to the EU, now allows continued imports of coffee, soybeans, and cocoa from regions experiencing deforestation, contributing to expectations of steady supply.
Weather conditions in Brazil are playing a mixed role. In the country’s largest arabica-producing region, Minas Gerais, rainfall was reported at just 11 mm for the week ending December 5, only 17% of the historical average—offering some support for prices.
U.S. coffee inventories monitored by ICE have tightened due to tariffs on Brazilian coffee imports. Arabica stocks fell to a 1.75-year low of 398,645 bags in late November, though they recently rebounded to over 426,000 bags. Robusta stocks dropped to an 11.5-month low on Monday. U.S. purchases of Brazilian coffee from August to October declined 52% year-on-year following the tariff implementation, reducing domestic supply.
On the other hand, increased production from Vietnam exerts downward pressure on prices. The country is expected to produce 1.76 million metric tons (29.4 million bags) in 2025/26, a four-year high, with the Vietnam Coffee and Cocoa Association projecting a 10% increase over the previous crop if favorable weather continues. Vietnam remains the world’s largest robusta producer.
Globally, signs of tighter supplies provide some price support. The International Coffee Organization reported a slight 0.3% year-on-year decline in global coffee exports for the current marketing year, totaling 138.658 million bags.
The USDA projects world coffee production in 2025/26 to reach a record 178.68 million bags, with arabica slightly down 1.7% to 97.022 million bags and robusta rising 7.9% to 81.658 million bags. Brazil’s output is expected to increase modestly to 65 million bags, while Vietnam’s crop could rise to a four-year high of 31 million bags. Global ending stocks are forecast to grow nearly 5% to 22.819 million bags.
