Arabica Coffee Futures Hover Around 1-Week High

Arabica coffee futures traded around $2.95 per pound, hovering at one-week highs, mainly supported by the Brazilian real's strength, a factor that reduces the country's export competitiveness and tends to limit external supply. Still, expectations for an ample crop this year from top grower Brazil continued to weigh. The market remains focused on weather conditions ahead of next month’s harvest, with crop development so far mostly favorable, reinforcing expectations of strong output. In Colombia, the world’s second-largest arabica producer, output fell 29% year-on-year to 754,000 tonnes in March due to heavy rainfall. Meanwhile, geopolitical tensions remained closely monitored due to their potential impact on logistics costs.

Arabica coffee futures traded around $2.9 per pound, the lowest in over three weeks, as prospects of ample supply offset the effects of a stronger Brazilian real. According to an analysis by StoneX released on April 6, the global coffee market is expected to register a surplus of approximately 10 million bags in 2026, mainly due to an anticipated record harvest in Brazil, alongside strong production in Vietnam. Brazil is expected to harvest 75.3 million bags in 2026/27, a 20.8% yearly increase, driven by recovery from the previous season's weather damage and structural improvements in production. Global coffee stocks are projected to increase from around 38 million to over 48 million bags by 2026, with Brazilian reserves expected to grow by approximately 5 million bags. In Brazilian coffee fields, producers are moving into the harvest season, with Robusta in its early stages and Arabica approaching its peak harvesting period in the coming months.

Arabica coffee futures traded near $2.9 per pound, the lowest in over two weeks, pressured by expectations of increased global supply, especially from top producer Brazil. The start of the harvest in the coming weeks is expected to gradually increase the availability of coffee in the physical market, which reinforces seasonal pressure on prices. On Thursday, Marex Group Plc projected a record 2026/27 Brazil coffee crop of 75.9 million bags, surpassing last week’s forecast from Sucafina of 75.4 million bags, and representing a 15.5% year-on-year increase. Earlier this month, StoneX also raised its Brazil 2026/27 production estimate to a record 75.3 million bags, up from 70.7 million bags in November. At the same time, certified Arabica stocks have picked up recently, though still below historical norms, providing some relief to near-term supply pressures. Meanwhile, the market remains alert as Middle East tensions push oil prices higher, boosting transportation and operational costs.