Coffee Market Plummets Amid Demand Pressures and Climate Uncertainties

The international coffee market closed Thursday with a sharp drop in prices, reflecting growing concerns over global demand. Arabica futures on the New York Stock Exchange registered significant losses, with the May/25 contract falling by 1,790 points. Robusta, traded in London, also followed the downward trend, impacted by an unfavorable external scenario. The main concern revolves around rising import tariffs in the United States, which could increase the final price of coffee for consumers and reduce sales volumes—particularly for major buyers like Starbucks, Hershey, and Mondelez.

On the supply side, the outlook is mixed, adding further instability to the market. Brazil’s 2025/26 harvest is already underway, beginning with Conilon (Robusta) farms and expected to continue through September. However, forecasts for Arabica point to a significant decline in production—between 10% and 13.6%—due to adverse weather conditions, such as drought and excessive heat during key flowering periods. This potential reduction in Arabica availability could push prices higher in the medium term if demand remains steady.

Meanwhile, Robusta production is expected to increase by 7.3% to 12%, which could help partially balance the supply outlook. Still, the market remains sensitive to any new developments related to climate, tariffs, and global consumption. The combination of macroeconomic and agronomic factors continues to drive volatility on global exchanges and calls for caution from all actors in the coffee supply chain. The recent drop may represent a technical correction or the beginning of a longer-term trend, depending on how international conditions evolve.

Source: Notícias Agrícolas