Market Reports

The analysts Safras & Mercado report that Brazilian coffee farmers have sold approximately 91% of the estimated 64.25 million bags from the current 2025/26 crop. This pace lags the same time last year, when around 97% of the crop had already been sold. It is likely that this year will be the first since 2022 that there may be adequate carryover stocks between the crop years.  In a normal production and supply environment context, local carryover is considered comfortable if somewhere between two and three months of export and local demand.  Thus, applying this year’s average monthly export figure at around 3 million bags per month, while accounting for local consumption of approximately 1.80 million bags per month that is primarily robusta coffee, one would assume a surplus carry-over from their record Brazil Conilon production in 2025/26 and a relatively small arabica carryover, into the new crop year.

Safras & Mercado have estimated that almost 23% of the new Brazil coffee crop has already been harvested as of the 2^nd June 2026.  The harvest this year is at a marginally slower pace, when compared to the same time last year, which was reported at 28%. 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 17.40 million bags of the new crop have been harvested, most of which will be Conilon robusta due to the earlier ripening of this coffee in the northeastern districts.

It is reported that Brazilian coffee farmers have sold approximately 19% of the estimated 75.65 million bags from the upcoming 2026/27 crop. The anticipated larger arabica harvest is expected to provide much-needed relief to the tight global supply pipeline following several consecutive years of lower crops. This increase is seen as essential to meet both domestic consumption and export demand. However, forward sales are reported at a slower pace when compared to last year, which likely reflects subdued internal market conditions, where well-financed producers continue to be conservative, and buyers remain cautious in their forward purchasing strategies.

Colombia, the world’s largest producer of high-quality washed Arabica coffee with two annual crops, is currently harvesting its midyear mitaca crop. The flow from the main crop eased earlier than usual, largely due to persistent heavy rainfall. At the same time, the mitaca harvest has progressed more slowly than expected, as residual effects of last year’s excessive rainfall continue to weigh on crop development. This has supported an uptick in internal prices in the largest washed arabica coffee producer.

Trade activity across the Central American washed Arabica producing bloc has weakened markedly compared to the same period last year, with most coffees harvested during the first four to five months of the October 2025 to September 2026 coffee year are already believed to be sold. Honduras remains the region’s largest producer and exporter, with exports projected at around 5.50 million bags, up 15.45% year on year. Elsewhere, Costa Rica, Guatemala, El Salvador, and Nicaragua are expected to show relatively stable output, with full-year export performance broadly aligned with the previous season.

Although detailed country level export data remains limited, the commercialisation of the Central American crop has generally taken place earlier than usual this season. Producers have taken advantage of stronger New York Arabica prices during the last quarter of 2024 and January 2026. However, visibility of these coffees in consumer markets remains low, suggesting that a sizeable share of shipments has either been committed directly to roasters or is still working its way through the supply chain.

Looking ahead, the emergence of El Niño in the second half of 2026 introduces a notable weather risk for coffee production across South and Central America. Historically, El Niño conditions are associated with higher temperatures, extended dry periods in parts of Brazil and Central America, and more erratic rainfall patterns that can disrupt flowering and cherry development stages. While the precise regional impact remains uncertain, market participants are closely monitoring developments. A stronger El Niño event could reduce yield potential for the 2026/27 and 2027/28 coffee crops, particularly if moisture deficits coincide with key flowering periods. In Central America, producers remain exposed to drought stress and potential productivity losses. As a result, weather-related supply concerns are likely to remain a supportive factor for prices and a source of heightened market volatility in the months ahead.

Coffee production in Kenya for the current October 2025 to September 2026 coffee year shall likely reach 850,000 bags or 13.33% higher year on year.  Of this crop, the forecast is that Kenya will export 11.11% more than the previous year at a total of 800,000 bags of green coffee while local consumption is growing from a low base, registered at a comparatively low 62,000 bags, which releases the majority of the coffee production to the export consumer market. Kenya is forecast to see an improvement in production for the coming October 2026 to September 2027 coffee year, which shall be 100,000 bags or 11.76% higher than the current year, to total 950,000 bags. The Ministry of Co-operatives and Mirco, Small and Medium Enterprise Development has reported that coffee exports are expected to rise by 5.76% during the 2026 year to reach 916,667 bags.

The Certified washed Arabica coffee stocks held against the New York exchange registered a decrease by 285 bags yesterday, to register these stocks at 396,957 bags, with 72.41% of these certified stocks held in Europe, at a total of 287,422 and the remaining 27.59% being held in the USA at a total 109,535 bags. Of this, a total 10,455 or 2.63% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 29.13% of these certified coffees, from Honduras at 115,646 bags and 15.46% 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 July 2026 to July 2026 contract arbitrage between the London and New York markets widened yesterday, to register this at 111.08 Usc/Lb. This equates to 40.06% price discount for London robusta coffee.

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

It was a firmer day on the commodity markets yesterday, as markets priced in a less firm US Federal Reserve outlook following the interim US Iran agreement. Lower oil prices eased inflation fears, supporting metals and boosting sentiment across the broader commodity complex. The Coffee, Cocoa, Soybean, Sugar, Wheat, Gold, Silver, Platinum and Palladium markets ended the day on a firmer note, while the Corn market ended the day on a softer note. The day starts with the US Dollar trading at 1.343 Sterling, at 1.161 to the Euro and with the US Dollar buying 5.088 Brazil Real.

The London and New York markets opened the day trading to the north of par from the outset. Both markets quickly made gains with support to trend firmer through the remainder of the early morning session in limited trade volume to start the day. As the afternoon progressed, the New York market continued to trend in a firmer direction, where buyers buoyed the market higher in the absence of sellers, the day tracked quickly higher to trigger buy stops along the way, with limited liquidity aiding in the firmer trajectory.  This firmer action continued in both the New York and London markets as the day progressed.  The upward moment in New York in a market lacking any selling action continued through to the late afternoon session. The New York market encountered a slight degree of resistance late in the day to limit the gains with the market settling on a very firm note and most of the earlier gains of the day intact. The London market set a new high for the day during the late afternoon session before being capped to drop back marginally and settle on a firm note, near to the highs of the day’s trading range.

The London market ended the day on a modest positive note, with 91.76% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note with 88.00% of the earlier gains of the day intact.  This firmer close for the markets, with both the New York and London markets trading in firmer territory to settle near to the highs of the day in a comparatively light volume day, with the speculative sector at the helm and three sessions before first notice day in the prompt month in New York, might see the markets set for a buoyant start to early trade today, against the prices set yesterday, as follows: