Coffee prices extended their decline today, with arabica coffee (KCK25) dropping by -2.50 (-0.67%) and robusta coffee (RMK25) falling by -36 (-0.67%). This marks a continued slide over the past week, with arabica reaching a three-week low and robusta hitting a one-month low.
The primary factor behind today’s drop is the strength of the U.S. dollar, which has been pressuring most commodity prices, including coffee. Additionally, arabica coffee prices are feeling the impact of a rebound in ICE-monitored arabica inventories, which rose to a one-week high of 803,066 bags on Tuesday, up from a nine-month low of 758,514 bags the previous week.
Meanwhile, ICE-monitored robusta coffee inventories also experienced fluctuations, reaching a five-month high of 4,603 lots on January 31, before dropping to a two-month low of 4,296 lots today.
On the bullish side, there are factors supporting coffee prices. In Brazil, the world’s largest arabica coffee producer, rainfall has been below average, with Minas Gerais, the country’s biggest arabica-growing area, receiving only 24% of its usual rainfall last week. This could potentially reduce the upcoming crop yield and support prices.
Additionally, a significant portion of Brazil’s coffee harvest has already been sold. As of February 11, 88% of the 2024/25 harvest had been sold, ahead of last year’s pace and the five-year average. However, sales of the 2025/26 crop have been slower, with only 13% of the crop sold so far, which could indicate a tighter future supply and less willingness from producers to sell.
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