As coffee prices continue to react to global supply pressures, DRWakefield’s June 2025 market report highlights a turbulent period for Arabica and Robusta futures. With low certified stocks, unpredictable weather in producing countries, and shifting macroeconomic indicators, the global coffee market is once again showing signs of stress and uncertainty.
Volatility Returns to Arabica as Frost Fears Collide with Macro Pressure
The week of June 9–13, 2025, opened with bullish sentiment for Arabica, following a significant drop in certified stock levels—down by 61,500 bags the previous week. European Coffee Federation (ECF) stocks remain at just 7.07 million bags, a worrying 5 million bags below the 5-year average. Japan Coffee Association (JCA) inventories are also tight, reported at 2.21 million bags, around 500,000 bags below the average.
Despite this backdrop, the market moved erratically. Arabica futures opened Monday at 357.85 c/lb, closing only slightly higher at 361.55 c/lb. But by Tuesday, frost warnings in Minas Gerais (Guaxupé and Poços) ignited a rally into the 370 c/lb range, before collapsing to a close of 355.05 c/lb. As frost concerns eased midweek and key technical levels failed to hold, Arabica resumed its descent. It hit a low of 338 c/lb on Friday before ending the week at 349.70 c/lb, partially buoyed by opportunistic roaster buying.
Robusta Shows Brief Strength Before Retreating Again
The London Robusta market saw a short-lived recovery midweek after breaking a six-day bearish streak. Prices reached a low of $4,315/MT, the weakest since November 2024, before rebounding and then declining again to close the week at $4,440/MT. Although up temporarily, the market remains well below this year’s high of $5,800/MT, reflecting strong export pressure from Vietnam and Brazil’s progressing harvest.
Production Outlook: Mixed Signals from Key Origins
In Brazil, Arabica production is forecast to fall 11%, down to 40.46 million bags, while Robusta is expected to increase 20% to 25 million bags, pushing total output to 65.51 million bags. Experts say Robusta yields may even surpass forecasts, contributing to falling Robusta prices.
Meanwhile, in Central America, recent rainfall has helped development, but the USDA’s Foreign Agricultural Service predicts an overall increase in 2025/26 harvest volumes—except Costa Rica, where output is expected to decline by 10% to 1.17 million bags, reversing last year’s growth cycle. Excessive rainfall in November and December hampered previous harvests, and though 2025 is expected to have “neutral” weather, uncertainty remains.
Colombia, on the other hand, faces a potential 5.3% decline in coffee production for the upcoming season, with an output estimated at 12.5 million bags. While the country is recovering from the El Niño-driven climate disruption, current heavy rains are now threatening flowering and cherry development, particularly in the south. High prices are also discouraging farm investment in replanting, raising concerns over long-term yield.
Certified Stocks & Commitment of Traders (COT)
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Arabica Certified Stock: ↑ 846,291 bags
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Pending Grading: ↓ 77,961 bags (down 45,425 from last week)
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Non-commercial net long: ↓ 21,712 futures lots
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Commercial net short: ↓ 53,686 futures lots
Organic Coffee Faces Delays Amid EU Compliance Challenges
Organic-certified exports from Central and South America continue to face bottlenecks. Residue from glyphosate—a commonly used herbicide—has been detected in containers entering the European Union, often traced to cross-contamination from nearby non-organic farms. Exporters are cautious about offering forward contracts until physical stocks are secured, forcing organic buyers to wait several months to cover supply gaps.
Currency Movements & Macro Conditions
U.S. Dollar Index (DXY): The World Bank has revised its 2025 global growth forecast down to 2.3%, the lowest since the 1960s, as post-pandemic and geopolitical challenges linger. The OECD echoed the downgrade, citing growth of 2.9% in 2025–2026. Despite momentary support from positive U.S. payroll data, the USD fell to a 3-year low midweek due to concerns over U.S.–China trade uncertainty. However, a late-week rebound followed renewed cooperation between the two countries.
GBP/USD: The British pound opened the week under pressure, triggered by April unemployment rising to 4.6%, the highest since August 2021, and slowing wage growth (5.2%). UK GDP shrank by 0.3% in April, marking the sharpest monthly decline since October 2023.
Middle East Tensions Surge Oil Prices
Heightened conflict between Israel and Iran—marked by Israeli airstrikes on Tehran on Friday, June 13—fueled a 10% jump in oil prices, raising fears of disruption to global crude supply. Iran’s strategic exports to India and China and its critical shipping lanes are now viewed as potential flashpoints that could rattle global trade and inflation.
Qahwa World Insight
June 2025 underscores the fragility of the global coffee supply chain—from frost alerts in Brazil and production cuts in Colombia and Costa Rica to certification hurdles affecting organic exports. The market remains on edge as traders weigh short-term weather shifts against long-term macroeconomic and geopolitical risks. With prices volatile and supply chains constrained, the second half of the year could test the resilience of roasters, exporters, and coffee producers alike.