Coffee futures finished mixed on Monday, with September arabica coffee falling and September ICE robusta rising. Arabica for September, linked to contract KCU26, closed down 3.25 cents per pound (-0.97%), while September ICE robusta for contract RMU26 settled up 19 cents per metric ton (+0.50%), as weather-driven supply expectations in Brazil competed with inventory and production signals elsewhere.
Brazil rainfall and harvest pace were central to arabica’s pullback, while robusta’s advance was tempered by signs of rising stocks and stronger export activity from Vietnam, the world’s largest robusta exporter.
Key takeaways
- Price move: September arabica coffee fell (-0.97%) while September ICE robusta rose (+0.50%).
- Catalyst: Below-normal rainfall in Brazil supported faster harvesting for arabica, while rising ICE robusta inventories weighed on robusta fundamentals.
- Key implication: Traders appear to be balancing near-term weather and harvest progress in Brazil against longer-term production and stock forecasts that point to higher global supply.
- Weather watch: El Niño concerns are still seen as a potential risk factor for future Brazil crop conditions, which could reverse sentiment.
What drove the move
Arabica softened on Brazil rainfall and harvest pace. Market participants pointed to forecasts and reported conditions suggesting harvest momentum could improve. Somar Meteorologia reported that 5.8 mm of rain, or 92% of the historical average, fell in the week ended Aug. 9 in Minas Gerais, Brazil’s main arabica-growing region.
That incremental clarity on harvest timing fed into additional signs of slower progress earlier in the season. Data referenced from Cooxupe co-op showed member harvest completion at 67.3% as of July 31, behind 74.2% at the same point last year. Separately, Safras & Mercado reported that Brazil’s 2026/27 coffee harvest was 64% complete as of July 15, compared with 77% at the corresponding time last year and a five-year average of 70%.
Robusta’s rise ran into inventory pressure. Although robusta ended higher on Monday, the market faced bearish inventory developments. ICE robusta inventories climbed to a 4.5-month high of 4,285 lots, a factor described as weighing on robusta prices.
Arabica inventories, however, were tighter. By contrast, ICE arabica coffee inventories fell to a 2.5-year low of 242,673 bags on Monday, which helped limit downside for arabica even as rainfall data nudged the contract lower.
USDA forecast and production outlook
Beyond short-term weather, the latest USDA biannual outlook pointed toward a broader supply increase that could cap price rallies. According to the USDA’s July 22 forecast, global coffee output in the 2026-27 season is expected to rise by 6.0% year over year (10.8 million bags) to a record 189.7 million bags, supported mainly by improved growing conditions in Brazil.
The report also projected a split between arabica and robusta: global arabica production is expected to increase 12% year over year, while robusta production is forecast to decline 0.7% year over year. World ending stocks were projected to rise by 1.9 million bags to 26.3 million bags.
Earlier USDA Foreign Agricultural Service (FAS) projections cited in the article also supported the larger supply narrative, including an expected record Brazil crop of 71.9 million bags for 2026/27, up 14% year over year.
Weather risk and trading signals from Vietnam
El Niño concerns remain a tail risk for future yields. The market also continues to monitor the possibility that El Niño could disrupt Brazil’s crop cycle next year. Commercial highlighted that El Niño may delay rains in Brazil during September and October, the period when tree flowering typically occurs, potentially affecting the 2026/27 crop.
The US Climate Prediction Center indicated that the El Niño pattern emerging across the equatorial Pacific last month is likely to be among the strongest in more than 75 years, raising the risk of later-season weather variability—including the potential for floods, droughts, and temperature swings across parts of Asia and South America.
Vietnam export momentum is bearish for robusta. On the supply side for robusta, stronger export performance from Vietnam was cited as a negative. Vietnam’s National Statistics Office reported that Vietnam’s 2026 coffee exports for January through July rose 21.1% year over year to 1.31 million metric tons. Vietnam’s 2025 coffee exports were reported up 17.5% year over year to 1.58 million metric tons.
The article also referenced projections for higher production in the country. Vietnam’s 2025/26 coffee production is projected to rise 6% year over year to a four-year high of 1.76 million metric tons (29.4 million bags). Together, these figures reinforce expectations for steadier or rising robusta availability from the dominant exporter.
Market reaction and what to watch next
Monday’s mixed settlement suggests traders are treating Brazil’s near-term harvest timing and inventory tightness differently across arabica and robusta. Arabica was pressured by reported rainfall below historical norms that can accelerate picking, even as low ICE arabica stocks provided support. Robusta’s modest gain occurred despite a build in ICE inventories and ongoing bearish signals from Vietnam’s export and production data.
Looking ahead, investors will likely track additional weather developments tied to El Niño forecasts, updated harvest estimates from Brazil, and further inventory readings from ICE. Macro themes such as broader commodity risk appetite may also influence futures direction, but the immediate balance of weather, stock levels, and exporter flow data should remain the key drivers.
