CropGPT - Coffee

The weekly report on the global Coffee market for week 40. Brought to you by CropGPT

Show Notes

Global Coffee Market Summary: 
  • Brazil remains the central supply story. USDA projects 2026/27 production at a record 71.9 million bags, while StoneX forecasts an even higher 77.2 million bags. CONAB has also raised its 2026 estimate to 67.6 million bags, supported by a projected 34.8% increase in Arabica production to 48.91 million bags. Robusta production, however, is expected to decline 6.6% to 19.39 million bags. Exports remain strong, with August shipments reaching 4.155 million bags, up 31% year on year, while Brazil's Trade Ministry reported a 44.6% increase in August coffee exports.
  • Weather remains a key variable for Brazil's next crop. Rainfall has generally been supportive of flowering, although heat risks in Espirito Santo and uneven conditions in other regions could affect development. Quality is a more persistent concern, with reduced availability of exchange-grade coffee pushing up premiums. Producers are also facing tighter margins as the coffee-to-fertilizer exchange ratio deteriorates, while warehouse capacity constraints and the growing threat of coffee berry borer add pressure to the supply chain.
  • Vietnam continues to support global Robusta availability, with 2025/26 production forecast to rise 6% to a four-year high of 1.76 million tonnes. Exports from January through August increased 13.7% year on year, although export prices have fallen sharply. Favorable rainfall and soil moisture are supporting cherry development as the harvest approaches, leaving Vietnam with relatively low weather risk.
  • Other major origins face more significant challenges. Colombia's output has fallen approximately 17% to 12.4 million bags, while an earthquake in key growing regions and disruptions around Buenaventura have added supply concerns. Indonesia currently carries the highest weather risk among major producers, with worsening drought in southern Sumatra threatening flowering and crop development. Ethiopia also faces medium weather risk as low rainfall and high temperatures threaten cherry size, weight, and quality.
  • At the global level, the coffee market is moving into a clear surplus, with 2025/26 production reaching a new high and consumption weakening. Global output is projected to increase another 6% in 2026/27, largely because of Brazil, while softer imports point to slower demand. The main bullish counterweight is Arabica availability, with ICE-certified stocks remaining near historical lows. Robusta inventories, in contrast, have increased, reinforcing weaker sentiment in that segment.

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Speaker 1:

Welcome to the weekly summary of the global coffee market for 10/04/2026. For more information on any aspect of this report, please visit the CropGPT website for far more detailed reporting and analysis. Brazil Brazil continues to dominate the global coffee market, projecting substantial supply growth for the twenty twenty six R-twenty seven season. The United States Department of estimates a historic high of 71,900,000 bags, marking a 14% increase year on year, while Stonex's projection is even more optimistic at 77,200,000 bags. CONAB has also adjusted its 2026 estimate upwards to 67,600,000 bags, largely due to a predicted 34.8% increase in Arabica production to 48,910,000 bags.

Speaker 1:

In contrast, Robusta output is expected to decline by 6.6% to 19,390,000 bags. Harvest progress has lagged slightly behind, with Kuktsupe reporting a 91.9% completion rate by August 28, compared to 94.9% the previous year. Export activities remain robust, reaching record highs. August reported a 31% year on year increase in Sea Cafee exports, amounting to 4,155,000 bags, with notable rises in both Arabica and Robusta exports. The Brazilian Trade Ministry recorded a 44.6% surge in August exports, the largest in eight months.

Speaker 1:

The United States Department of Agriculture anticipates green exports to reach 49,400,000 bags in twenty twenty six-twenty seven, signaling a nearly 30% increase. This is compounded by the weaker Brazilian real, which has motivated increased sales. Weather poses a significant risk as Brazil approaches its critical flowering stage for the next crop cycle. Mixed weather reports show limited rains predicted for Mina Shiraiis, triggering short covering activities among funds. Yet past weeks have seen above average rainfall, which is beneficial for flowering.

Speaker 1:

Espirito Santo, a key robusta region, is similarly experiencing good rainfall, though a forecasted heat wave could pose risks. Despite these factors, Brazil's overall weather risk remains moderate. Quality concerns pose a structural challenge as exchange grade coffee qualification has plummeted, exacerbated by earlier excessive rainfall. This has caused a sharp rise in premium differentials for quality coffee. Grower margins are under strain, with a deteriorating coffee to fertilizer exchange ratio severely impacting field management resources.

Speaker 1:

Logistics face bottlenecks with warehouse capacities maxed out, further complicating supply chain dynamics. Additional agronomic risks include the spread of the coffee berry borer potentially threatening future crop cycles if not effectively managed, given current financial constraints on pest control. Sarmuichi Ho, Vietnam. As the leading robusta producer, Vietnam is contributing significantly to global coffee supply. Production for the twenty nineteen-twenty five-twenty six season is forecast to rise by 6% to a four year high of 1,760,000 tons.

Speaker 1:

Exports have been robust, with January to August figures up 13.7% year on year. However, export prices have fallen, notably by 20.4% to levels not seen since June 2024. Favorable weather conditions support Vietnam's positive supply outlook, with abundant rainfall enhancing soil moisture for cherry development. Overall, Vietnam's weather risk is low as harvest time nears, with expected conditions supportive of ripening and quality. Iquihong, Colombia, Colombia faces production challenges alongside acute event risks.

Speaker 1:

A significant earthquake affected key coffee growing regions, though fortunately, no major damage to processing facilities was reported. Output has seen a notable decline, down approximately 17 to 12,400,000 bags. Despite resumed partial export activities from Buenaventura, supply disruptions are a concern. Indonesia. Indonesia presents the highest weather risk among major coffee producers, with a worsening drought affecting Southern Sumatra.

Speaker 1:

Critical regions like Lampung have seen vastly reduced rainfall, posing significant risks to the coffee crop and delaying critical flowering phases. Prices for Sumatra robusta have shown mixed trends with varying premiums reported for upcoming shipments, reflecting market uncertainties due to weather conditions. Zafyteru, Ethiopia. Ethiopia is experiencing medium weather risk as cherry ripening approaches. A persistent shortfall in rainfall coupled with high temperatures threatens cherry size, weight, and quality.

Speaker 1:

With forecasted minimal rainfall, adverse impacts are anticipated. Today at Higher Global Balance Sheet Context. The global market reports a clear surplus with twenty twenty five-twenty six production reaching a new high and consumption declining. The projected twenty twenty six-twenty seven output is expected to grow further by 6%, primarily driven by Brazil. However, demand is softening as indicated by reduced imports by countries.

Speaker 1:

A key bullish factor is the scarcity of Arabica, with ICE certified stocks at a historical low despite slight recoveries. Conversely, robusta inventories have increased, reinforcing the negative robusta market sentiment. The potential for one of the strongest El Nino events poses an overarching risk, possibly delaying critical flowering periods and affecting Asian production. Remember, our CropGPT site contains far more details and reports about the coffee market, including crop health reports, twenty years of weather data, and even pricing data and earning call analysis. This podcast is just a few selected highlights for the week.