Market Reports

Within the relatively new coffee consumer market space, China, coffee consumption continues to expand rapidly, driven by factors such as urbanisation, growing consumer sophistication, and the expansion of retail, café, and e-commerce channels. Although coffee consumption remains relatively low on a per capita basis, China is one of the fastest-growing coffee markets globally. The USDA forecasts domestic coffee consumption to increase by 6.55% during the October 2025 to September 2026 coffee year, reaching 5.85 million bags. As both a coffee-producing and consuming country, China sources the majority of its coffee domestically, with less than 40% of total consumption supplied by imported green coffee. Consumer demand is increasingly segmented, ranging from premium specialty and single-origin coffees consumed in specialty cafés to affordable instant and ready-to-drink convenience coffee products. Major urban centres such as Shanghai, Beijing, Shenzhen, and Guangzhou are leading consumption growth, with Shanghai alone having more than 9,100 coffee shops in 2025. Large domestic chains continue to drive market scale, with Luckin Coffee expanding to more than 30,000 stores nationwide and Cotti Coffee, launched in 2022, growing rapidly to over 16,500 outlets.

Safras & Mercado have estimated that almost 39% of the new Brazil coffee crop has already been harvested as of the 17^th June 2026.  The harvest this year is at a slower pace, when compared to the same time last year, which was reported at 43%. Based on their forecast for a new crop of 75.65 million bags, of which Arabica production is forecast at 49.95 million bags, which is forecast to possibly break the prior record of arabica production set in crop year 2020/21.   The report indicates that so far approximately 29.51 million bags of the new crop have been harvested.

In other news, Brazil’s Central Bank reduced their benchmark Selic rate by 25 basis points during their June meeting held earlier this week, to now be 14.25%. The decision marks the third consecutive 25-basis-point cut as policymakers continue a cautious easing cycle after maintaining rates at 15.00% through the second half of 2025. While the move reflects confidence in gradually lowering borrowing costs from near two-decade highs, the central bank remains wary of persistent inflationary pressures.

The Certified washed Arabica coffee stocks held against the New York exchange registered a decrease by 1,904 bags yesterday, to register these stocks at 394,267 bags, with 71.86% of these certified stocks held in Europe, at a total of 286,343 and the remaining 28.14% being held in the USA at a total 107,924 bags. Of this, a total 10,455 or 2.65% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 28.99% of these certified coffees, from Honduras at 114,321 bags and 15.57% from Peru at a total 61,407 bags. The pending grading remained unchanged on the day, registering 1,375 bags pending grading, with 100% from Honduras.

The September 2026 to September 2026 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 103.19 Usc/Lb. This equates to 38.53% price discount for London robusta coffee.

The New York arabica coffee market shall be closed today in observance of the Juneteenth Federal Holiday, leaving the London Robusta coffee market will be trading solo for the day.

It was a mixed day on the commodity markets yesterday, with a stronger U.S. dollar and higher interest rate expectations following the Federal Reserve’s policy outlook. Meanwhile, easing Middle East tensions and declining oil prices tempered inflation expectations. The London Robusta Coffee market ended the day on a firmer note, while the New York Arabica Coffee, Cocoa, Corn, Soybean, Sugar, Wheat, Gold, Silver, Palladium and Platinum markets ended the day on a softer note. The day starts with the US Dollar trading at 1.321 Sterling, at 1.146 to the Euro and with the US Dollar buying 5.172 Brazil Real.

The London market opened the day on a modest near to unchanged softer note yesterday, followed by New York on a firm track at the open. The momentum in London continued throughout the morning session, to see the market gain support gapping higher at the outset. The New York market quickly gained support, trending firmer to set a new high for the day.  The activity in both markets modest as the morning progressed with New York settling into a range, with the London market following suit to set a new high for the day. As the afternoon progressed both the London and New York markets continued to trade in firmer territory, oscillating between the highs of the morning before attracting some degree of resistance near to the highs. The New York market encountered a degree of selling pressure, trading back through par and into softer territory during the later afternoon session. The New York market set a new low for the day, late in the session to settle on a softer note at the close. The London market was seen to drop back from the earlier highs and settle on a modest near to unchanged firmer note at the close.

The London market ended the day on a modest positive note, with 12.07% of the earlier gains of the day intact, while the New York market ended the day on a negative note with 59.42% of the earlier losses of the day intact.  This mixed close for the markets, with the London market settling on a modest firmer note at the close and the New York market recovering most of the earlier losses of the day to settle on a soft note at the close, might see the London market trading solo for the day set for a hesitant start to early trade, against the prices set yesterday, as follows: