Global Coffee Supply Expansion Pressures Prices on Barchart Markets

Coffee commodity prices retreated sharply in recent trading, with March arabica coffee closing down 0.15 cents (-0.05%), while March robusta coffee declined 68 points (-1.82%). Both arabica and robusta varieties hit multi-month lows, reflecting a significant shift in the global supply landscape. According to Barchart commodity analysis, the recent weakness stems from an improved outlook for worldwide coffee production, particularly driven by larger harvests anticipated from major producing nations.

The primary driver of recent coffee price weakness comes from Brazil’s dramatically improved production forecast. On February 5, Conab, Brazil’s crop forecasting agency, released projections indicating that Brazil’s 2026 coffee production will surge by 17.2% year-over-year to a record 66.2 million bags. Within this figure, arabica production is expected to climb 23.2% to 44.1 million bags, while robusta output will rise 6.3% to 22.1 million bags. This record harvest anticipation has weighed heavily on coffee prices across both varietals.

Regional Production Strength and Coffee Supply Dynamics

Weather conditions in Brazil’s major coffee-growing regions have bolstered the production outlook further. Somar Meteorologia reported that Minas Gerais, the world’s largest arabica coffee-growing area, received 72.6 millimeters of rain during the week ending February 6—representing 113% of historical averages. Adequate moisture conditions support the foundation for the anticipated record harvest in Brazilian coffee production.

Vietnam, the globe’s largest robusta producer, continues to drive coffee supply expansion through aggressive export activity. Vietnam’s National Statistics Office reported that January coffee exports surged 38.3% year-over-year to 198,000 metric tons, while full-year 2025 coffee exports jumped 17.5% to 1.58 million metric tons. Looking ahead, Vietnam’s 2025/26 coffee production is projected to increase 6% year-over-year to 1.76 million metric tons—a four-year high. This export acceleration underscores the robust supply pipeline pressuring coffee prices, particularly for robusta varieties.

Coffee Inventory Recovery and Global Production Forecasts

The recovery in monitored coffee inventories represents another bearish factor for price support. ICE-tracked arabica inventories, which had fallen to a 1.75-year low of 396,513 bags on November 18, have recovered to 461,829 bags by January 7. Similarly, ICE robusta coffee inventories, after hitting a 13-month low of 4,012 lots in December, rebounded to 4,662 lots by late January. This inventory replenishment signals easing supply tightness in the physical market.

The USDA’s Foreign Agriculture Service released its December bi-annual projection forecasting that world coffee production in 2025/26 will increase 2.0% year-over-year to a record 178.848 million bags. The projection anticipates a 4.7% decrease in arabica production to 95.515 million bags offset by a 10.9% increase in robusta production to 83.333 million bags. For Brazil specifically, FAS forecasts a 3.1% decline in production to 63 million bags, while Vietnam’s output is expected to rise 6.2% to a four-year high of 30.8 million bags.

Emerging Supply Constraints and Coffee Market Balance

While the global coffee supply outlook has improved substantially, certain production headwinds provide limited price support. Colombia, the world’s second-largest arabica producer, reported a significant production decline. The National Federation of Coffee Growers indicated that January coffee production fell 34% year-over-year to 893,000 bags, which offers some modest support to arabica prices amid broader supply abundance. Additionally, Brazil’s January coffee exports declined 42.4% year-over-year to 141,000 metric tons, suggesting seasonal export patterns are influencing near-term price dynamics.

The International Coffee Organization reported that global coffee exports for the current marketing year (October-September) fell marginally by 0.3% year-over-year to 138.658 million bags. However, the FAS projection indicates that 2025/26 ending stocks will fall 5.4% to 20.148 million bags from 21.307 million bags in the prior year—a modest decline that underscores the structural surplus in the coffee market. This combination of record production forecasts, inventory recovery, and rising export volumes from Vietnam continues to exert downward pressure on coffee values across both arabica and robusta markets.

Information based on reports from Conab, Somar Meteorologia, Vietnam’s National Statistics Office, ICE, the International Coffee Organization, and the USDA’s Foreign Agriculture Service.