Market Reports

The futures coffee market direction and focus remains fixed on Brazil, where coffee export activities are now picking up pace.

The large 2026/27 crop harvest is complete, while pressure begins to build in warehouses, while so too, greater visibility in coffee export statistics. The record August 2026 exports reported by the Coffee Exporters Association in Brazil, Cecafé, at 3.82 million bags, with a further 336,008 bags soluble coffee to total a sizeable 4.15 million bags of coffee to consumer markets.

Meanwhile, recent rainfall has improved soil moisture and provided suitable conditions for the flower set for the 2027/28 crop development. The early flowering follows an unusually wet winter in many south eastern arabica districts. Weather conditions will continue to be monitored in the Brazil Conilon robusta areas, as well as the progress and set of arabica flowering a little further to the south.

Within the largest washed arabica producing nation of Colombia, weather conditions have turned drier through August and September, providing a change from the wetter conditions seen earlier in 2026. However, continued dryness will need to be monitored, particularly given the potential for El Niño to bring drier than normal conditions to the country. Commercial activity is relatively limited ahead of the arrival of the main crop later this year, with market attention increasingly focused on the progress of the new crop and upcoming weather conditions.

It is the early stages of the October 2026 to September 2027 new crop harvest season for Colombia, Central America and Mexico coffee producers, where quality washed arabica coffee harvests are soon to pick up pace.  Hurricane Polo, which has been classified as a category 5 storm, continues to track along the west coast of Mexico. Traditionally the seasonal hurricane season in the Gulf of Mexico comes to an end around November, one might anticipate further storms to form over the next few weeks to bring along the potential for spells of heavy winds and rainfall.

The Brazilian Coffee Roasters Association ABIC reported that during the November 2024 to October 2025 period, Brazilian local coffee consumption declined by 2.30% from the same period in the previous year, to an estimated 21.40 million bags. ABIC also reported that roasted coffee industry revenue increased by 25.60% year on year over the same period, reaching US$8.90 billion. The higher futures reference prices seen during the period translated rapidly into the domestic market, with increases in finished coffee product prices being passed through to consumers at the retail and supermarket level. The resulting decline in consumption demand was largely attributed to the impact of higher prices on the shelf. Although the percentage decline appeared relatively modest, it represented approximately 550,000 bags of consumption and was therefore significant in volume terms. At the same time, some consumption in coffee-producing regions, where coffee remains a household staple, may have shifted toward more informal or locally sourced channels and consequently may not have been fully reflected in formal consumption statistics. ABIC had anticipated a slight recovery in domestic consumption during the 2025/26 coffee year as consumer prices stabilised and availability improved with the arrival of the new Brazil crop.

That anticipated recovery is now beginning to be reflected in retail sales data. The Brazilian Association of the Soluble Coffee Industry ABICS reported that retail coffee sales in Brazil, the world’s largest coffee-producing market, increased by 2.30% during the first eight months of 2026 compared with the same period in 2025, reaching the equivalent of 13.69 million bags. ABIC attributed the increase in retail shelf sales in part to the comparative 5.40% decline recorded during the same period of 2025, when higher coffee prices were initially passed through to consumers. The Brazilian Institute of Geography and Statistics (IBGE) has also reported a decline in consumer prices over the past eight months, providing further support for the improvement in retail demand. ABICS currently reports Brazilian domestic consumption at approximately 21.70 million bags, indicating that the market is showing signs of recovery as retail prices moderate and supply availability improves.

The current inflationary environment appears to be affecting where consumers choose to purchase their coffee rather than significantly reducing overall consumption. The National Coffee Association’s latest data shows that 66% of surveyed Americans had consumed coffee in the previous day, unchanged from Spring 2026. However, only 28% reported having coffee from an out-of-home venue, down by 1 percentage point over the past five years, while around 80% of coffee prepared is still consumed at home. This suggests that as the cost of everyday goods and services rises, consumers may be becoming more selective about discretionary purchases such as café coffee, with home preparation offering a more economical alternative. As a result, the rising price of a cup of coffee may increasingly influence purchasing decisions, particularly where consumers can easily substitute an out-of-home purchase with a lower cost option at home.

In logistics news, the drier weather conditions affecting the Panama Canal is creating pressure by restricting the movement of vessels through a major international trade route.  The canal is particularly important for trade between Asia and the United States, and disruptions have already resulted in significant increases in the cost of freight. For the commodity market in general prolonged restrictions could increase freight costs and shipment lead times. With El Niño conditions expected to intensify later in the year, continued disruption to the canal could add further volatility to global supply chains.

The Certified washed arabica coffee stocks held against the New York arabica market registered a increase of 3,323 bags yesterday, to register these stocks at 256,678 bags, with 77.80% of these certified stocks held in Europe, at a total of 199,692 bags and the remaining 22.20% being held in the USA at a total 56,986 bags. Of this, a total 52,791 or 20.57% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 21.07% of these certified coffees, from Honduras at 54,084 bags and 18.97% from Peru at a total 48,696 bags. The pending grading decreased by 5,198 bags on the day, registering 20,157 bags pending grading, with 91.71% pending grading from Brazil.

The November 2026 to December 2026 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 124.43 Usc/Lb. This equates to a 45.70% price discount for London robusta coffee.

It was a mixed day on the commodity markets yesterday, as Oil prices retreated from  the highs seen earlier in the week following an improved outlook on prospects in the Gulf, while the US Dollar was firmer on the day adding pressure to the greater commodity basket. The Cocoa, Sugar, Wheat and Platinum markets ended the day on a firmer note, while the Coffee, Corn, Soybean, Wheat, Gold, Silver and Palladium markets ended the day on a softer note. The day starts with the US Dollar trading at 1.331 Sterling, at 1.142 to the Euro and with the US Dollar buying 5.101 Brazil Real.

The London market started the day trading on a firmer note, to set a new high from the outset of the day while the New York market started the day yesterday trading to the south of par on modest softer note, with the markets gaining a small degree of support to set a new high for the day early in the day. The support was short lived with the markets encountering selling pressure through the early morning session in comparatively muted volumes. Both the London and the New York markets encountered sustained selling pressure during the morning session, extending losses for the day and maintaining a bearish trajectory. As the afternoon progressed, the US Dollar firmed, adding further weight to the markets. Despite the downward pressure, buying support came to the fore during the early afternoon session to see the markets reverse the trend, and recover some of the earlier losses albeit only briefly, as a lack of support at the top saw the markets drop back and into a softer path for the remainder of the day. Both markets recovered marginally from the day’s lows but ultimately settled near the bottom of the day’s range, ending the session on a negative note.

The London market ended the day on a negative note, with 83.70% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 80.39% of earlier losses of the day intact. This follow through softer close for the markets and with both the New York and the London markets retaining most of the earlier losses to settle near to the lows of the day in a good volume day, as the markets sustained a large degree of selling pressure, might lead one to think that the markets are due for less than a hesitant start to early trade today, against the prices set yesterday, as follows: