March arabica fell 7.20 cents (-2.00%) to a three-week low and January robusta dropped 86 points (-2.13%) to a four-month low as two weeks of ample rains in Brazil and bullish supply revisions pressured prices; Climatempo and Somar reported above-average precipitation in key growing states and Brazil's Conab raised its 2025 output estimate to 56.54 million bags. Vietnamese supply signals are also bearish—November exports jumped 39% y/y and 2025/26 production is forecast to rise roughly 6–10%—while ICE-monitored arabica stocks have been tight recently (a 1.75-year low mid-November) even as robusta stocks hit an 11.5-month low; US purchases were depressed earlier by tariffs but remain constrained. Taken together, the near-term price move is bearish driven by improved Brazilian crop prospects and rising Vietnamese output, though limited arabica exchange stocks provide intermittent support amid a USDA outlook for record global coffee production and higher ending stocks next season.
March arabica futures fell 7.20 cents (-2.00%) to a three-week low and January ICE robusta dropped 86 points (-2.13%) to a four-month low as coffee prices extended a two-week slide driven by improved Brazilian weather and supply outlooks. Climatempo forecasted “intense and persistent rainfall” for Brazil's coffee regions and Somar reported Minas Gerais received 79.8 mm in the week to Dec. 12, or 155% of the historical average, which is bearish for crop development and near-term price sentiment. Brazil’s crop agency Conab raised its 2025 coffee production estimate 2.4% to 56.54 million bags from 55.20 million on Dec. 4, while Vietnam’s Nov exports jumped 39% y/y to 88,000 MT and Jan–Nov exports rose 14.8% y/y to 1.398 MMT, supporting a view of abundant robusta supplies; Vietnam 2025/26 output is projected roughly +6% y/y. ICE-monitored arabica stocks hit a 1.75-year low of 398,645 bags on Nov. 20 but recovered to 426,523 on Dec. 5, and robusta inventories fell to an 11.5-month low of 4,012 lots, creating asymmetric support for arabica despite broader bearish fundamentals. Macro supply forecasts show mixed pressure: the ICO reported global exports down 0.3% y/y to 138.658 million bags (Oct–Sep), yet USDA FAS projects world coffee production up 2.5% y/y to a record 178.68 million bags with ending stocks rising 4.9% to 22.819 million bags in 2025/26. Net effect is near-term downside from wetter Brazil and rising Vietnamese output, counterbalanced by episodic support from tight exchange inventories and the lingering impact of earlier U.S. tariff-related demand shifts (U.S. purchases Aug–Oct were down 52% y/y to 983,970 bags).
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moderately negative
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-0.45
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