Climate Stress and Exchange Rates Drive Up Coffee Prices in National and International Markets

The lack of significant rainfall in Brazil's key coffee-producing regions, such as Minas Gerais, São Paulo, and Espírito Santo, has led to prolonged climate stress on coffee crops, directly impacting the prices of Arabica coffee in the international market. On Monday (26th), Arabica futures on the New York Stock Exchange recorded significant increases, reflecting investors' concerns about the potential decrease in the 2025/26 crop yields. Adverse weather conditions remain a critical factor in the appreciation of future contracts, especially amid uncertainty about the climate in the coming weeks.

While Arabica saw an increase, the Robusta coffee market remained stable on the London Exchange due to the holiday in the United Kingdom. This highlights how external factors, such as holidays, can influence price stability in specific markets. However, forecasts suggest that reduced humidity in the coming weeks could continue to pressure coffee prices, while abundant rainfall could provide relief and a more optimistic outlook for future crops.

In the Brazilian domestic market, coffee prices also showed variations, with some regions experiencing appreciation, such as Poços de Caldas and Varginha, while others, like Guaxupé, saw a decline in the price of peeled cherry coffee. The volatility in prices reflects a combination of climatic factors and currency exchange rates, leading to historically high offers. Thus, the domestic market continues to be influenced by both adverse weather conditions and currency instability, creating a constantly changing environment for producers and investors alike.

Source: Notícias Agrícolas