Dubai – Qahwa World
Coffee markets saw gains on Wednesday, with May arabica (KCK26) climbing +3.10 (+1.09%) and May robusta (RMK26) rising +29 (+1.78%).
Analysts attribute the rebound to supply-side concerns. The ongoing conflict in Iran has disrupted shipping through the Strait of Hormuz, driving up global freight rates, insurance costs, and fuel expenses—factors that are expected to push costs higher for coffee importers and roasters.
Meanwhile, favorable weather in Brazil is supporting the country’s coffee crop but is acting as a bearish influence on prices. Somar Meteorologia reported that Minas Gerais, Brazil’s largest arabica-growing region, received 78 mm of rainfall in the week ending February 20, 131% of the historical average.
You may read: War Redraws Global Shipping Map and Pressures Coffee Supply Chains
Despite this, coffee prices had sharply declined over the past five weeks, with arabica hitting a 15-month low last Tuesday and robusta dropping to a 6.75-month low last Monday. Brazil’s crop forecasts show strong production ahead: the national agency Conab predicts 2026 coffee output will reach a record 66.2 million bags, up +17.2% year-on-year. Arabica production is expected at 44.1 million bags (+23.2% y/y), and robusta at 22.1 million bags (+6.3% y/y).
On a global scale, Rabobank projects coffee production in 2026/27 to hit 180 million bags, an increase of 8 million bags from the previous year.
Vietnam, the largest robusta producer, is also contributing to market pressure. January coffee exports surged +38.3% y/y to 198,000 metric tons, while total 2025 exports jumped +17.5% y/y to 1.58 MMT. Vietnam’s 2025/26 production is projected to reach 1.76 MMT (29.4 million bags), a four-year high.
Inventory dynamics are mixed. ICE-monitored arabica stocks, which fell to a 1.75-year low of 396,513 bags on November 18, have rebounded to a four-and-three-quarter-month high of 528,028 bags. Robusta inventories also recovered to a 3.25-month high of 4,721 lots after hitting a 14-month low in December.
Brazilian exports, however, fell sharply in January, with 141,000 MT shipped (-42.4% y/y), while Colombia’s smaller output supports price levels. The National Federation of Coffee Growers reported that January arabica production fell -34% y/y to 893,000 bags.
The International Coffee Organization noted a slight global export decline for the marketing year (Oct-Sep) of -0.3% y/y to 138.658 million bags. USDA forecasts for 2025/26 show total world coffee production rising +2.0% y/y to a record 178.848 million bags. Arabica output is expected to fall -4.7% to 95.515 million bags, while robusta climbs +10.9% to 83.333 million bags. Brazil’s production is projected at 63 million bags (-3.1%), and Vietnam’s at 30.8 million bags (+6.2%). Ending stocks are forecast to decline -5.4% to 20.148 million bags.
