Coffee Prices Fall on Abundant Rainfall in Brazil
Coffee prices today are moving lower as abundant rainfall in Brazil has eased dryness concerns and is positive for the country's coffee crops. Somar Meteorologia reported today that Brazil's largest arabica coffee-growing area, Minas Gerais, received 5 mm of rain during the week ended June 28, which is 714% of the historical average.
Coffee Prices Fall on Abundant Rainfall in Brazil
Cocoa Prices Higher on Dollar Weakness and Tighter Ivory Coast Supplies
Get exclusive insights with the FREE Barchart Brief newsletter. Subscribe now for quick, incisive midday market analysis you won't find anywhere else.
Coffee prices have retreated over the past two months, with arabica coffee posting a 6-3/4 month low last Friday. The outlook for abundant coffee supplies is undercutting prices. Last Wednesday, the USDA's Foreign Agricultural Service (FAS) forecast that Brazil's 2025/26 coffee production will increase by 0.5% year-over-year (y/y) to 65 million bags and that Vietnam's 2025/26 coffee output will rise by 6.9% y/y to a 4-year high of 31 million bags. Brazil is the world's largest producer of arabica coffee, and Vietnam is the world's largest producer of robusta coffee.
The advancing coffee harvest in Brazil is also weighing on coffee prices. Last Tuesday, Brazil's Cooxupe coffee co-op announced that its members reported the coffee harvest was only 24.3% complete as of June 20, compared with 34.2% completed at the same time last year. Cooxupe is Brazil's largest coffee cooperative and Brazil's largest exporter of coffee. Also, Safras & Mercado recently reported that Brazil's 2025/26 coffee harvest was 35% complete as of June 11, slightly behind last year's comparable level of 37% but in line with the 5-year average of 35%. The breakdown showed that 49% of the robusta harvest and 26% of the arabica harvest were complete as of June 11. Brazil's arabica harvest has been slowed by heavy rain in some areas.
Robusta coffee prices have received support from tightening supplies after ICE-monitored robusta coffee inventories fell to a 6-week low last Thursday at 5,108 lots. However, in a bearish factor for arabica prices, ICE-monitored arabica coffee inventories rose to a 4-3/4 month high of 892,468 bags on May 27 and were modestly below that high at 844,319 bags as of last Friday.
Smaller coffee exports from Brazil are bullish for prices. Last Wednesday, Cecafe reported that Brazil's May green coffee exports fell by -36% y/y to 2.8 million bags.
Due to drought, Vietnam's coffee production in the 2023/24 crop year decreased by 20% to 1.472 MMT, the smallest crop in four years. Also, Vietnam's General Statistics Office reported that 2024 Vietnam coffee exports fell by -17.1% y/y to 1.35 MMT. Last Tuesday, Vietnam's National Statistics Office reported that Vietnam's 2025 Vietnam's Jan-May coffee exports are down -1.8% y/y to 813,000 MT. In addition, the Vietnam Coffee and Cocoa Association on March 12 cut its 2024/25 Vietnam coffee production estimate to 26.5 million bags from a December estimate of 28 million bags.
The USDA's biannual report, released last Wednesday, was bearish for coffee prices. The USDA's Foreign Agriculture Service (FAS) projected that world coffee production in 2025/26 will increase +2.5% y/y to a record 178.68 million bags, with a -1.7% decrease in arabica production to 97.022 million bags and a +7.9% increase in robusta production to 81.658 million bags. The USDA's FAS forecasts that 2025/26 ending stocks will climb by +4.9% to 22.819 million bags from 21.752 million bags in 2024/25.
For the 2025/26 marketing year, Volcafe projects a global 2025/26 arabica coffee deficit of -8.5 million bags, wider than the -5.5 million bag deficit for 2024/25 and the fifth consecutive year of deficits.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
12 minutes ago
- Bloomberg
IMF Relaxes Argentina's Reserves Target by $5 Billion in 2025
The International Monetary Fund gave Argentina breathing room on a key benchmark after it missed the target this month, making it easier for the country to continue with its $20 billion funding program. Argentina will now need to raise net hard-currency reserves to negative $2.6 billion by the end of this year to unlock the next tranche of IMF funds, about $5 billion lower than the earlier target. The figure is currently at negative $6.4 billion, in part because of a sovereign bond payment last month.
Yahoo
an hour ago
- Yahoo
StoneCo Ltd (STNE) Announced Divestment of its Software Segment
StoneCo Ltd. (NASDAQ:STNE) is one of the . On July 22, StoneCo Ltd. (NASDAQ:STNE) announced its divestment plan through which it will sell most of its software segment, including Linx and other related assets, to TOTVS for R$3.41 billion. The assets included in the announcement account for almost 79% of the segment's 2024 revenue. While this deal is subject to regulatory approvals, the company has completed the sale of its veterinary software SimplesVet to PetLove for R$140 million. After the sales of these assets, the company will retain a few software businesses which it plans to sell in the future. Management noted that this is a strategic move to focus more on its core business. The company noted that the utilization plan for the proceeds would be announced after the deals close. A team of software engineers in a digital workspace collaborating on a financial technology software solution. StoneCo Ltd. (NASDAQ:STNE) is a financial technology company that provides cloud-based payment and software solutions. While we acknowledge the potential of STNE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
an hour ago
- Yahoo
Soybeans Fade Back to Close Steady
Soybean futures fell weaker into the Friday close, as the three nearby contracts were unchanged at the final bell. August fell 37 cents this week, with November 31 ¾ cents lower. The cmdtyView national average Cash Bean price was down 3 ½ cents at $9.31 ½. Soymeal futures saw Friday gains of $3.30 to $5.70/ton, with August down just 30 cents on the week. Soy Oil posted losses of 20 to 86 points at the close, as August was down 177 points this week. The forecast for the next 7 days from NOAA shows a drier pattern across IA, MO, and the ECB, with the Plains seeing light totals to just over an inch. More News from Barchart Brazil Tariff Risks Underpin Arabica Coffee Prices Arabica Coffee Rises as Tariff Risks Remain Cocoa Prices Settle Sharply Higher on Supply Woes Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! The large managed money speculators in soybean futures and options added another 25,445 contracts back on to their net short as of July 29, taking their net position to 36,311 contracts by Tuesday. USDA's Fats & Oils report showed 197.1 mbu of soybeans crushed during June, above trade estimates and a record for the month. That was also 7.44% above last year but down 3.22% below May. Soybean oil stocks for the end of the month totaled 1.894 billion lbs, which was slightly higher than in May but still down 10.85% from last year. Aug 25 Soybeans closed at $9.61 3/4, unch, Sep 25 Soybeans closed at $9.69 1/2, unch, Nov 25 Soybeans closed at $9.89 1/4, unch, On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
