Market Reports

Weather remains one of the key variables for the coffee market, particularly as El Niño has now become firmly established and is expected to strengthen into late 2026. The developing weather pattern is becoming increasingly relevant for Central American arabica, with Guatemala already experiencing below-normal rainfall and elevated temperatures. Guatemala’s meteorological authorities are forecasting El Niño conditions with a 95–100% probability through March 2027, while rainfall during the latter part of the 2026 wet season which should come to an end in October, is expected to remain below normal in several coffee producing areas. Continued warm and dry conditions could increase moisture stress and affect bean development for the upcoming harvest.

The potential for a strong El Niño through late 2026 and into early 2027 has raised concerns around increased heat and altered rainfall patterns across parts of Asia, Central America, and Brazil, although the impact is likely to vary by in timing related to the seasonal development of the coffee in each country or region.

The Certified washed arabica coffee stocks held against the New York arabica market registered a decrease of 2,198 bags yesterday, to register these stocks at 254,480 bags, with 77.47% of these certified stocks held in Europe, at a total of 199,692 bags and the remaining 22.53% being held in the USA at a total 54,788 bags. Of this, a total 52,791 or 20.74% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 21.15% of these certified coffees, from Honduras at 53,839 bags and 19.09% from Peru at a total 48,598 bags. The pending grading increase by 960 bags on the day, registering 21,117 bags pending grading, with 92.09% pending grading from Brazil.

The November 2026 to December 2026 contract arbitrage between the London and New York markets widened yesterday, to register this at 125.44 Usc/Lb. This equates to a 45.46% price discount for London robusta coffee.

It was a softer day on the commodity markets yesterday, with the US Dollar reaching a two-month high against a basket of other currencies. A firmer US Dollar is traditionally a bearish factor for commodities traded in other currencies. The Coffee, Cocoa and Sugar markets ended the day on a firmer note, while the Corn, Soybean, Wheat, Gold, Silver, Platinum and Palladium markets ended the day on a softer note. The day starts with the US Dollar trading at 1.324 Sterling, at 1.138 to the Euro and with the US Dollar buying 5.168 Brazil Real.

The London and New York markets started the day yesterday trading to the south of par on softer notes respectively. The markets continued a softer note throughout the remainder of the early morning session, pressured lower to set a new low for the day. As the day progressed, the markets garnered support to trend firmer albeit in limited trade volume. 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 was briefly halted, with a small degree of selling activity during the mid-afternoon session, with the market dropping back to set a new low for the day. This selling pressure was short lived, and the market quickly recovered to trend firmer to the close.  The New York market settled on a firmer note at the close with more than half of the earlier gains of the day intact, while the London market settled on a very firm note at the close, near to the highs of the day’s trading range.

The London market ended the day on a positive note, with 90.47% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note with 54.13% of earlier gains of the day intact. This firmer close for the markets, with the London market retaining most of the earlier gains of the day while the New York market traded in a choppier manner albeit under light volumes, might see the markets set for a follow through steady start to early trade today, against the prices set yesterday, as follows: