Arabica coffee prices surged to a 1.5-month high on Friday, closing up 2.94%, while robusta coffee dipped slightly. The closure of the Strait of Hormuz has disrupted global shipping routes, tightening supply and contributing to the rally in coffee prices. However, a stronger dollar and expectations of increased Brazilian coffee production have tempered gains, with robusta inventories hitting a two-month low.
The dynamics in the coffee market are shifting, with Brazil’s recent rains alleviating crop concerns and leading to a projected record coffee production of 75.3 million bags for the 2026/27 season. This outlook, coupled with rising ICE arabica inventories, is likely to pressure prices moving forward. Additionally, robusta prices face bearish pressure from surging exports from Vietnam, which reported a 14% year-on-year increase in early 2026.
For market professionals, the implications are clear: while current prices are buoyed by supply disruptions, the forecast of a bumper Brazilian crop could lead to significant downward pressure on coffee prices. Dive deeper into these developments by exploring the full article.
Source: nasdaq.com