Coffee Market Report
The Vietnam Customs Authority has reported that Vietnam’s cumulative export performance for the first two months of the current October 2024 to September 2025 coffee year, at 983,000 bags or 36.61% lower than the same period in the previous year, to a cumulative two-month total 1,733,333 bags. This decline in exports reported year on year might be attributed to the delay in harvest due to the extended wet weather experienced during the first two months of the coffee year. The comparative export figures are at the same time, benchmarked against the extraordinary record exports reported during the first two months of the 2023/2024 coffee year out of Vietnam.
The continuation of unseasonal rains has led most forecasters to anticipate a lower year on year export performance for the month of December which will shortly be released by the Vietnam Customs Authority. There is some anticipation that export flow may start to improve as the new year progresses with perhaps the interruption of Tet Lunar New Year celebrations to come at the end of January. The cumulative production and forecasts for the delayed but progressing harvest, may inspire lower crop estimates to come to the fore. While estimates vary by a margin of 3 million bags, the median estimate for the October 2024 to September 2025 coffee year is set at 28 million bags. There is as yet, no evidence that this year will be a repeat of the hefty frontloading in coffee exports to consumer markets which was recorded in the new crop year in reaction to the lack of availability from Vietnam at the tail end of the 2022/23 coffee export year from this largest robusta producer and supplier to consumer markets.
The climate in Brazil as the new July 2025 to June 2026 crop sets on the trees, has for the most part of December, since reported improved rainfall and dispersion across the vast coffee growing areas. The forecasts indicate rainfall to continue for the rest of the month, which is needed for the continued development of the new coffee crop. This crop has been forecast to have the potential to reach a median estimate of 64 million bags for the forthcoming biennially higher bearing crop year.
Excluding Brazil, which is a well-established coffee consumer market and ranks second only to the USA in terms of consumption, other coffee markets have emerged over time, primarily within coffee-producing countries. Nations like China, India, Indonesia, and Vietnam have seen notable increases in domestic coffee consumption alongside growth in value-added products and export sectors.
China has seen their domestic consumption increase by 40% over the last 5 years to potentially reach 6.20 million bags during the 2024/25 coffee year as reported by USDA. Domestic consumption within Indonesia meanwhile is anticipated to reach 4.80 million bags during the current coffee year, growing 10.35% over the last 5 years. While Vietnam internal domestic consumption is anticipated by the USDA to total 3.60 million bags during the 2024/2025 coffee year, marking growth of 33.33% over the last 5 years. However, in these traditionally tea-focused markets, coffee consumption is starting from a relatively low base. Similarly, non-producing countries in Southeast Asia, the Middle East, and, to some extent, Africa have experienced a rise in coffee consumption in recent years, driven by the popularity of trendy urban coffee shops that appeal to younger generations.
The question heading into this new year is whether coffee consumption may start to reflect consumer price resistance, more so in these comparatively new coffee consumer markets that have reflected positive year on year growth over time, but are inherently economically sensitive to sharp price moves. There is growing consensus, although may take time to translate into quantifiable figures, that mature non-producing coffee consumer markets, particularly in northern Europe have seen coffee consumption flatline, ahead of the next round of inevitable new year price increases that will soon reflect within consumer markets, following the meteoric rise in coffee futures markets in 2024.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 5,830 bags yesterday, to register these stocks at 985,797 bags, with 98.27% of these certified stocks held in Europe, at a total of 968,703 bags and the remaining 1.73% being held in the USA at a total 17,094 Bags. Of this, a total 619,659 bags or 62.86% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 10.01% of these certified coffees, from Peru. The pending grading stocks were seen to decrease by 12,987 bags on the day, to register 41,770 bags pending grading on the day.
The March 2025 to March 2025 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 97.51 Usc/Lb. This equates to 29.83% price discount for the London robusta coffee.
It was a firmer day on the commodity markets yesterday, with a slew of economic data to include, US Jobs and employment data, the US Federal Reserve Monetary Policy December meeting minutes and the US Federal Reserve’s 2025 rates outlook due to be released in the coming week. The Coffee, Corn, Soybean, Sugar, Gold, Silver, Platinum and Palladium markets ended the day on a firmer note, whilst the Cocoa and Wheat markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.239 Sterling, at 1.027 the Euro and with the US Dollar buying 6.152 Brazil Real.
The New York and London markets opened the day on a positive note, to see the markets continue to trade in firm territory throughout the remainder of the morning session in limited trade volume. The New York market fell back off of the highs of the morning for a brief period during the late morning session, albeit still in positive territory. The London market continued to trade in positive territory, making gains throughout the session. With low volume in play, news came to the fore of a continuation of inclement weather in Vietnam and a bullish reaction took hold in London, where buyers returned to the floor in the absence of sellers, the day tracked quickly higher to trigger buy stops along the way. The New York market found support to rebound from the day's lows and continue on a firmer trajectory. This firmer action continued in both the New York and London markets as the day progressed. The New York market continued the upward momentum before being capped late in the day, to see the market settle on a firm note at the close with most of the earlier gains of the day intact. The London market followed suit to also settle on a firm note at the close, with most of the earlier gains of the day intact.
The London market ended the day on a positive note with 80.44% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note, with 70.65% of the earlier gains of the day intact. The firmer close for the markets, with both the New York and London markets trading in firmer territory from the outset of the session, settled near to the highs of the day in comparatively modest volumes for the day. With the speculative sector at the helm and technical moves in play, the markets might be in for a follow through steady start to early trade today, against the prices set yesterday, as follows:
LONDON ROBUSTA US$/MT NEW YORK USC/LB.
MAR 5056 + 181 MAR 326.85 + 7.10
MAY 4977 + 172 MAY 322.10 + 7.25
JUL 4892 + 165 JUL 316.15 + 7.70
SEP 4804 + 163 SEP 309.80 + 7.80
NOV 4722 + 159 DEC 296.65 + 7.30
JAN 4644 + 156 MAR 286.90 + 7.65
MAR 4571 + 145 MAY 279.25 + 7.70
MAY 4496 + 145 JUL 271.30 + 7.35
