Coffee Prices Surge as ICE Inventories Hit Multi-Year Lows
Dubai, August 27, 2025 (Qahwa World) – Coffee markets staged a sharp turnaround by Wednesday’s close, with both arabica and robusta futures rallying strongly as dwindling ICE inventories and tightening export flows outweighed harvest pressure from Brazil. The rebound highlights the volatility gripping global coffee trade, where supply constraints and policy shifts continue to drive rapid intraday price swings.
On the ICE exchange, December arabica coffee (KCZ25) jumped +13.00 (+3.49%), while November robusta (RMX25) surged +188 (+4.01%), with robusta touching a three-month high. The rally came just hours after arabica futures had slipped on harvest pressure, underscoring how quickly sentiment is shifting.
ICE-monitored stocks remain a key bullish driver. Arabica inventories fell to a 1.25-year low of 716,578 bags, while robusta dropped to a one-month low of 6,611 lots. Traders say the tightening certified stockpiles are providing strong underlying support, particularly for robusta. At the same time, Brazil’s harvest is almost complete. Cooxupé, the country’s largest cooperative, reported members were 91.3% finished by August 22, while Safras & Mercado estimated 99% of the crop complete, with robusta fully harvested and arabica at 98%. This progress has been weighing on prices, yet the bullish impact of falling inventories and weaker exports is increasingly dominant.
July export figures underline this trend. Brazil’s Trade Ministry reported a 20.4% year-on-year decline in unroasted coffee exports, totaling 161,000 metric tons. Cecafé confirmed a broader contraction, citing a 28% fall in green coffee exports to 2.4 million bags. Arabica exports dropped 21%, while robusta plunged 49%. Shipments for the first seven months of 2025 are down 21% at 22.2 million bags.
Outside Brazil, fundamentals remain tight. Vietnam’s 2023/24 crop fell 20% year-on-year to 1.47 million metric tons due to drought, the smallest in four years. Exports in 2024 declined 17%, though shipments this year have rebounded, rising 6.9% between January and July. At the global level, the International Coffee Organization (ICO) reported June exports up 7.3% year-on-year to 11.69 million bags, though cumulative shipments since October are slightly lower at -0.2%.
Looking ahead, the USDA’s Foreign Agricultural Service (FAS) projects record global production of 178.68 million bags in 2025/26, driven by robusta’s 7.9% expansion. Arabica output is expected to contract by 1.7% to 97 million bags. Despite this, Volcafé forecasts a deepening arabica deficit of 8.5 million bags, widening from this year’s 5.5 million, marking the fifth consecutive annual shortfall.
The market’s day-to-day volatility highlights the tension between short-term harvest pressure and long-term structural supply constraints. With U.S. buyers canceling contracts following 50% tariffs on Brazilian coffee, and inventories at multi-year lows, analysts warn the coming months could bring continued turbulence for global coffee prices.
