News and Articles

• Coffee prices rose on Middle East shipping disruption and higher transport costs
• ICE robusta inventories fell to a 16-month low of 3,788 lots
• Record Brazil crop expectations capped gains in the market
• Vietnam’s higher exports and production weighed on robusta prices
• Lower Brazil shipments and weak rainfall in Minas Gerais supported prices

Coffee futures closed higher on April 20 as shipping disruption in the Middle East added fresh support to the market. The move followed Iran’s statement on April 18 that the Strait of Hormuz had been closed to shipping after the United States refused to lift a naval blockade on Iranian vessels. Traders saw the development as a supply concern for coffee, with higher freight, fuel and insurance costs expected to raise expenses for importers and roasters.

Robusta also drew support from tightening exchange supplies. ICE-monitored robusta inventories fell to 3,788 lots on Monday, the lowest level in 16 months, pointing to a tighter near-term supply picture.

The upside, however, remained limited by expectations for a very large Brazilian crop. Recent estimates have placed Brazil’s 2026-27 coffee production in a range of roughly 75.3 million to 75.9 million bags, which would mark a record harvest. Forecasts have also pointed to a sharp rise in the global coffee surplus in 2026 to around 10 million bags, up from 1.8 million bags in 2025, which would be the largest surplus in six years.

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Robusta prices have also faced pressure from strong shipments out of Vietnam, the world’s top producer of the variety. Official data showed Vietnam’s coffee exports in the first three months of 2026 rose 14 per cent from a year earlier to 585,000 metric tons. Full-year exports in 2025 climbed 17.5 per cent to 1.58 million metric tons. The country’s 2025-26 coffee production is also expected to rise 6 per cent to 1.76 million metric tons, or 29.4 million bags, the highest in four years.

Smaller export volumes from Brazil have helped support prices. Industry and trade data released this month showed Brazil’s March coffee shipments fell sharply from a year earlier, with green coffee exports down to 2.65 million bags and total coffee exports also posting a steep annual decline.

Weather has added another supportive element. Brazil’s main arabica-growing region of Minas Gerais received only 4.2 millimetres of rain last week, according to meteorological data, or about 20 per cent of the historical average. That has raised concern about crop prospects in one of the country’s most important coffee-growing areas.

A softer point for the market remains export demand at the global level. The International Coffee Organization said world coffee exports in the current October-to-September marketing year were down 0.3 per cent year on year at 138.658 million bags in its latest available report.