Robusta coffee rises dramatically due to harvest concerns in Vietnam

The November robusta coffee (RMX25) increased +121 (+2.93%) today, while the December arabica coffee (KCZ25) decreased -1.50 (-0.41%).

Coffee prices show mixed behaviors. Arabica remains on the decline, although above the one-month low recorded last Friday, pressured by reports from the Washington Post about a bill that would exempt coffee imports from tariffs in the U.S.

The robusta rises dramatically in response to forecasts of heavy rains for the rest of the month in the Central Highlands of Vietnam, the country's main producing region. These rains could damage the grains that are in their final development phase before harvest.

The drought in Brazil continues to support prices. According to Somar Meteorologia, Minas Gerais, the largest arabica-producing region in Brazil, received only 10.5 mm of rain during the week ending September 20, just 73% of the historical average. September is crucial for the flowering of Brazilian coffee trees.

The 50% tariffs imposed on Brazilian imports have led to a sharp reduction in ICE coffee inventories, a bullish factor for prices. The arabica inventories monitored by ICE fell to a 16.75-month low of 654,224 bags last Friday. U.S. buyers are canceling new contracts for Brazilian coffee purchases due to these tariffs.

On the other hand, the abundant robusta harvest in Vietnam is putting downward pressure on prices. Vietnamese production for 2025/26 is expected to increase by +6% year-on-year to 1.76 million tons (29.4 million bags), a four-year high. Coffee exports from Vietnam increased by +7.8% year-on-year between January and August.

Last Tuesday, arabica reached contract and 7-month highs, while robusta rose to 3-week highs, driven by a lack of rain in Brazil. In addition, NOAA estimated a 71% probability of a La Niña event for October-December, which could bring drought to Brazil and affect the 2026/27 harvest.

Conab, the Brazilian forecasting agency, reduced its 2025 arabica harvest estimate by -4.9% to 35.2 million bags. The International Coffee Organization reported that global exports in July fell by -1.6% year-on-year.

Harvest pressures in Brazil are bearish for prices, with the Cooxupe cooperative announcing that the collection among its members was completed at 98.9% as of September 12.

The USDA Foreign Agricultural Service projected that global coffee production in 2025/26 will increase by +2.5% year-on-year to a record 178.68 million bags. However, Volcafe projects a global arabica deficit of -8.5 million bags for 2025/26, the fifth consecutive year of deficit.