Dubai – Qahwa World
Arabica coffee prices fell on Wednesday as forecasts of rainfall in Brazil’s coffee belt and renewed trade discussions between Brazil and the United States triggered selling in the futures market.
On the ICE exchange, December Arabica (KCZ25) dropped by –4.75 points (–1.19%), while November Robusta (RMX25) rose by +55 points (+1.23%). The session began with an upward trend but later reversed, with traders reacting to changing weather expectations and tariff concerns.
Traders who had bet on prolonged dry conditions liquidated positions after new forecasts showed that Brazil’s main coffee-growing regions would receive rain later this week. The shift came just after reports of drought-related stress in Minas Gerais, where rainfall during the week ending October 11 reached only 48% of the historical average, raising concerns for the crucial flowering phase of the 2026/27 crop.
Market sentiment also shifted after Bloomberg reported that Brazilian Foreign Affairs Minister Mauro Vieira is set to meet U.S. Secretary of State Marco Rubio on Thursday to discuss tariffs. The talks come amid ongoing U.S. import tariffs of 50% on Brazilian coffee, which have already reduced shipments and tightened U.S. supplies.
ICE-monitored arabica inventories fell to a 1.5-year low of 494,558 bags, while robusta inventories slipped to 6,200 lots, their lowest in nearly three months. Meanwhile, the NOAA recently raised the likelihood of a La Niña event to 71% for October–December, potentially bringing drier conditions to Brazil and heightening risks for the next harvest.
In contrast, Vietnam’s Central Highlands, the country’s main coffee zone, is forecast to receive above-average rainfall through October 20 — with Dak Lak province expecting 70 mm, compared with a historical average of 61 mm. The favorable weather supports a strong 2025/26 robusta crop, with production projected to rise by 6% year-on-year to 1.76 million tons (29.4 million bags) — a four-year high.
According to the Vietnam National Statistics Office, coffee exports in the first nine months of 2025 climbed 10.9% year-on-year to 1.23 million tons, adding to global supply pressures.
The U.S. Foreign Agricultural Service (FAS) projects 2025/26 global coffee production at a record 178.68 million bags, up 2.5% from the previous year. Arabica output is expected to decline 1.7%, while robusta rises 7.9%.
Brazil’s total coffee production is forecast at 65 million bags, up 0.5%, while Vietnam’s is seen reaching 31 million bags, up 6.9%.
However, global trading firm Volcafe anticipates an arabica deficit of 8.5 million bags for 2025/26 — the fifth consecutive annual shortfall.
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