Coffee prices experienced a decline on Tuesday, with July arabica coffee closing down 0.76% and July robusta coffee down 0.63%. The stronger dollar pressured prices, although losses were mitigated by tight inventories, with arabica stocks hitting a 2.5-month low and robusta inventories at a two-year low. The ongoing closure of the Strait of Hormuz has further strained global coffee supplies, driving up shipping and import costs.
Despite the recent price drop, the market faces conflicting pressures. Brazilian coffee exports are down significantly, with March shipments falling 31% year-over-year, which could support prices. Conversely, Vietnam’s robusta coffee exports surged by 15.8% year-over-year, adding bearish sentiment to robusta prices. Additionally, projections for a record Brazilian coffee crop in the 2026/27 season are likely to weigh on prices moving forward.
Market professionals should monitor the evolving supply dynamics, particularly the impact of geopolitical events and production forecasts, as these factors will be crucial in shaping coffee price trends in the coming months.
Source: nasdaq.com