Market Reports

The Brazil Real currency has strengthened by 5.98% against the US Dollar since the beginning of 2026, this may continue to contribute to a measured approach of producer selling activity within Brazil. This while the new crop harvest is by now mostly complete and flow of this coffee remains relatively muted.  A stronger Brazil Real traditionally discourages export selling from Brazil’s coffee producers, which could see a continued degree of internal price resistance and a reticence of well financed coffee producers to sell coffee at current market levels.

The month of August in Brazil’s coffee producing areas is historically one of the lowest rainfall months of the year, and while this year is no different there is data published by Refinitiv, to indicate that most areas within Southeastern Brazil have received average levels of rainfall for the month thus far. The Brazil coffee belt is forecast to remain dry for the next week to ten days, with the chance of isolated light rains to come to Espirito Santo and Rio de Janeiro.

Whilst the northern hemisphere coffee commercial industry return to the desk following the traditional summer holidays in an environment where consumer held coffee stocks are reported to be at very low levels, consumer markets continue to grapple with ongoing macro-economic pressures. The coffee futures market reference prices continue to reflect higher prices, with the recent upward rally have registered a 31.10% increase in the New York Arabica market and an 15.39% increase in the London Robusta market over the past three months, since June 2026, which is not anticipated to provide much relief to import supply conditions and consumer country coffee prices in the short to medium term.

The Certified washed arabica coffee stocks held against the New York exchange were seen to decrease by 800 bags yesterday, to register these stocks at 225,442 bags, with 73.62% of these certified stocks held in Europe, at a total of 165,963 and the remaining 26.38% being held in the USA at a total 59,479 bags. Of this, a total 7,068 or 3.14% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 26.16% of these certified coffees, from Honduras at 58,982 bags and 22.05% from Peru at a total 49,721 bags. The pending grading remained unchanged on the day, registering 1,920 bags pending grading.

The November 2026 to December 2026 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 168.08 Usc/Lb. This equates to a 50.09% price discount for London robusta coffee.

It was a softer day on the commodity markets yesterday, with the markets turning focus to Personal Consumption Expenditure data due to be released later today along with the US Federal Reserve’s outlook on interest rates. The 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 1.363 Sterling, at 1.167 to the Euro and with the US Dollar buying 5.147 Brazil Real.

The London market opened the day on a moderate to unchanged softer note while the New York market opened the day on a moderate firmer note to see both markets set a high for the day early before encountering resistance to drop back and trade in softer territory throughout the remainder of the early morning session. The New York market lost some ground for a brief period before finding support during the early afternoon session, to trade firmer. The London market continued to trade in negative territory, making losses throughout the session. As the afternoon progressed, the New York market continued to trend in a general firmer direction trading back towards par.  The New York market encountered resistance late in the day to drop back into softer territory and settle on a on softer note at the close albeit back from the day’s lows. The London market remained in negative territory for the afternoon session and settled on a softer note at the close, down from the highs at the start of the day.

The London market ended the day on a negative note, with 47.23% of the earlier losses of the day intact, while the New York market likewise ended the day on a negative note with 36.93% of earlier losses of the day intact. This softer close for the markets, does little to inspire confidence, albeit that the markets recovered from the lows of the day during what was a good trade volume session, and one might think that the markets are due for a steady start to early trade today, against the prices set yesterday, as follows