Arabica Coffee Prices Retreat on Brazil Coffee Crop Optimism
Coffee prices on Tuesday settled mixed. Sep arabica coffee tumbled to a contract low on Tuesday, and the nearest-futures (N25) contract fell to a 6-3/4 month low. Arabica coffee is under pressure as abundant rainfall in Brazil has eased dryness concerns and is positive for the country's coffee crops. Somar Meteorologia reported Monday 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.
Arabica Coffee Pressured by Beneficial Brazil Rain
Cocoa Prices Plunge on Expectations of a Bigger Ghana Cocoa Crop
Sugar Prices Plummet on Weak Demand and Ample Supplies
Get exclusive insights with the FREE Barchart Brief newsletter. Subscribe now for quick, incisive midday market analysis you won't find anywhere else.
However, Tuesday's slide in the dollar index (DXY00) to a 3-1/3 year low sparked some short covering in coffee futures and lifted robusta coffee into positive territory.
Coffee prices have retreated over the past two months, with arabica coffee posting a 6-3/4 month nearest-futures (N25) low on Tuesday. 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, following a decline in ICE-monitored robusta coffee inventories to a 6-week low of 5,108 lots last Thursday. However, a bearish factor for arabica prices is that 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 841,770 bags as of Tuesday.
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. Additionally, the Vietnam Coffee and Cocoa Association reduced its 2024/25 Vietnam coffee production estimate to 26.5 million bags on March 12, down 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
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
11 minutes ago
- Yahoo
Sugar Prices Recover on Possible Frost Risk in Brazil
October NY world sugar #11 (SBV25) today is up +0.75 (+4.81%), and August London ICE white sugar #5 (SWQ25) is up +19.40 (+4.23). Oct NY sugar today matched Wednesday's contract low but then rallied sharply on short-covering sparked a frost scare in Brazil. The NY sugar nearest-futures July contract posted a 4.25-year low on Monday. Aug London sugar today rallied sharply from Wednesday's 3.75-year nearest-futures low. Arabica Coffee Prices Are Falling. How Much Lower Will They Go? Brazil Coffee Harvest Pressures Weigh on Prices Coffee Prices Fall as Pace of Brazil's Coffee Harvest Accelerates Stop Missing Market Moves: Get the FREE Barchart Brief – your midday dose of stock movers, trending sectors, and actionable trade ideas, delivered right to your inbox. Sign Up Now! Sugar prices rallied sharply today as forecasts indicate a possible frost event in Brazil later this month. The peak time for frost in Brazil's sugar-growing areas is late July through early-August. Sugar prices have plummeted over the past three months due to expectations of a global sugar surplus. On Monday, commodities trader Czarnikow projected a 7.5 MMT global sugar surplus for the 2025/26 season, the largest surplus in 8 years. On May 22, the USDA, in its biannual report, projected that global 2025/26 sugar production would increase by +4.7% y/y to a record 189.318 million metric tons (MMT), with global sugar ending stocks at 41.188 MMT, up 7.5% year-over-year. The outlook for higher sugar production in India, the world's second-largest producer, is bearish for prices. On June 2, India's National Federation of Cooperative Sugar Factories projected that India's 2025/26 sugar production would climb +19% y/y to 35 MMT, citing larger planted cane acreage. The outlook for abundant rainfall in India could lead to a bumper sugar crop, which is bearish for prices. On April 15, India's Ministry of Earth Sciences projected an above-normal monsoon this year, with total rainfall forecast to be 105% of the long-term average. India's monsoon season runs from June through September. Signs of larger global sugar output are negative for prices. On May 22, the USDA's Foreign Agricultural Service (FAS) predicted that Brazil's 2025/26 sugar production would rise +2.3% y/y to a record 44.7 MMT. Also, India's 2025/26 sugar production is projected to rise +25% y/y to 35.3 MMT, citing favorable monsoon rains and increased sugar acreage. In addition, Thailand's 2025/26 sugar production is expected to climb +2% y/y to 10.3 MMT. In a bearish factor, the Indian government said on January 20 that it would allow its sugar mills to export 1 MMT of sugar this season, easing the restrictions placed on sugar exports in 2023. India has restricted sugar exports since October 2023 to maintain adequate domestic supplies. India allowed mills to export only 6.1 MMT of sugar during the 2022/23 season to September 30, after allowing exports of a record 11.1 MMT in the previous season. However, the ISMA projects that India's 2024/25 sugar production will fall -17.5% y/y to a 5-year low of 26.2 MMT. Also, the ISMA reported last Monday that India's sugar production from Oct 1-May 15 was 25.74 MMT, down -17% from the same period last year. In addition, Indian Food Secretary Chopra said on May 1 that India's 2024/25 sugar exports may only total 800,000 MT, below earlier expectations of 1 MMT. The outlook for higher sugar production in Thailand is bearish for sugar prices. On May 2, Thailand's Office of the Cane and Sugar Board reported that Thailand's 2024/25 sugar production rose +14% y/y to 10.00 MMT. Thailand is the world's third-largest sugar producer and the second-largest exporter of sugar. Sugar prices have some support from reduced sugar production in Brazil. Unica reported Monday that the cumulative 2025/26 Brazil Center-South sugar output through mid-June is down by -14.6% y/y to 9.404 MMT. Last month, Conab, Brazil's government crop forecasting agency, said 2024/25 Brazil sugar production fell by -3.4% y/y to 44.118 MMT, citing lower sugarcane yields due to drought and excessive heat. The International Sugar Organization (ISO) raised its 2024/25 global sugar deficit forecast to a 9-year high of -5.47 MMT on May 15, up from a February forecast of -4.88 MMT. This indicates a tightening market following the 2023/24 global sugar surplus of 1.31 MMT. ISO also cut its 2024/25 global sugar production forecast to 174.8 MMT from a February forecast of 175.5 MMT. The USDA, in its bi-annual report released May 22, projected that global 2025/26 sugar production would climb +4.7% y/y to a record 189.318 MMT and that global 2025/26 human sugar consumption would increase +1.4% y/y to a record 177.921 MMT. The USDA also forecasted that 2025/26 global sugar ending stocks would climb +7.5% y/y to 41.188 MMT. 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 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Axios
22 minutes ago
- Axios
Where SNAP cuts in Trump's "Big Beautiful Bill" could hit Americans hardest
President Trump's massive tax and spending bill, which is advancing through the House after surviving its Republican push through the Senate, would slash food benefits for thousands. The big picture: It would mark a historic cut to the social safety net that Republicans claim weeds out waste, fraud and abuse — but experts say the restructuring of assistance programs could leave more people hungry and uninsured. Context: Trump's signature policy bill adjusts work requirements for the Supplemental Nutrition Assistance Program, the country's largest nutrition assistance program. In order to keep their benefits under the Senate-passed version of the bill, parents of children aged 14 or older would have to meet work requirements. The bill also bumps the work requirement age up to 64. Currently, SNAP's requirements for able-bodied adults without dependents apply to those between 18 and 54. It could also force some states to shoulder more benefit costs, the rate of which would be set by a state's percent of erroneous payments. Benefits are currently 100% federally funded, though states share administrative costs. Threat level: Medicaid and food aid cuts could also lead to lead to job losses and hits to state GDPs, Axios' Alex Fitzpatrick writes. Zoom out: In March 2025, more than 42 million Americans participated in SNAP, according to initial USDA data. The program provides crucial support for families with low-paying jobs, low-income older adults, people with disabilities and others. According to a CBPP analysis of FY 2024 USDA data, more than 62% of SNAP participants are in families with children, and more than 38% are in working families. New Mexico has the largest share participating in SNAP, with some 21% of the population helped by the program, according to preliminary March data. By the numbers: The bill would reduce nutrition funding, which includes SNAP, by around $186 billion between 2025 and 2034. While analyst's projections have fluctuated as the legislation's provisions are tweaked, analysts have indicated millions of people could be cut from SNAP under the work requirement provisions. CBPP points to a CBO indication that more than 2 million people would be cut from SNAP under the work requirement provision. While the CBPP notes that revised legislation released June 25 slightly modified several SNAP provisions in the reconciliation plan, it still says more than 5 million people live in households at risk of losing at least some food assistance.
Associated Press
an hour ago
- Associated Press
Denny's and Waffle House remove egg surcharges as prices fall
Denny's and Waffle House have removed surcharges that the two restaurant chains added to their menus when U.S. egg prices spiked earlier in the year. Denny's confirmed Thursday that it eliminated its egg surcharge on May 21. Waffle House said Wednesday on social media that it canceled its surcharge on June 2. Waffle House instituted a 50-cent per egg surcharge in February at all of its 1,900 U.S. restaurants due to the soaring cost of eggs. Denny's also put a surcharge in place in February, but it varied by location. Outbreaks of bird flu in January and February caused the average price of a dozen Grade A eggs to hit a record high of $6.23 per dozen in March, according to the U.S. Bureau of Labor Statistics. More than 174.8 million wild bird and poultry have been killed due to the virus, which began circulating in January 2022. Any time a bird gets sick, the entire flock is killed to help keep the highly contagious flu from spreading. The mass slaughters can affect egg supplies because massive egg farms may have millions of birds. Egg prices at grocery stores began falling in April as bird flu cases fell and Easter demand eased. In May, the average retail price dropped further, to $4.55 per dozen. That was the lowest price since December, when eggs averaged $4.15 per dozen. Increased imports of eggs also helped lower prices. U.S. Agriculture Secretary Brooke Rollins said earlier this month that the U.S. has imported more than 26 million dozen shell eggs since January from Brazil, Honduras, Mexico, Turkey and South Korea. The federal government also approved three new facilities for receiving imported eggs. The government has also completed nearly 1,000 biosecurity assessments on U.S. farms and helped farms pay for biosecurity upgrades, Rollins said. Still, Rollins said the fall could be 'potentially challenging' for egg producers. Wild birds often spread the avian flu virus during their migrations.
