Robusta Coffee Futures Slide on Brazil's Rainfall and Rising Production Forecasts

Robusta coffee futures experienced significant losses as favorable weather in Brazil and surging global supply forecasts continued to pressure prices downward. March arabica coffee closed down 16.15 cents, or 4.85%, while March ICE robusta coffee fell 219 points, or 5.44%, marking extended declines across both varieties. Arabica prices hit a 5.5-month low, while robusta coffee futures descended to a 6-week low, signaling persistent bearish sentiment in the broader coffee market.

Brazil’s Heavy Rains Ease Drought Concerns

Weather developments in Brazil, the world’s largest coffee producer, have emerged as a key downward pressure on robusta coffee futures. Somar Meteorologia reported that Minas Gerais, Brazil’s primary arabica-growing region, received 69.8 mm of rainfall during the week ended January 30, representing 117% of the historical average. This above-average precipitation has substantially eased dryness concerns that had previously supported higher prices, creating headwinds for coffee futures markets globally.

The improved moisture conditions in Brazil’s coffee belt signal a potentially robust crop, further weighing on near-term price sentiment. Agricultural analysts note that the combination of adequate rainfall and previous soil moisture conditions positions the region well for the developing 2025/26 crop cycle.

Vietnam’s Surging Coffee Supply Weighs on Robusta

Vietnam, the world’s largest robusta coffee producer, continues to expand its supply footprint, presenting structural challenges for robusta coffee futures. Vietnam’s 2025 coffee exports jumped 17.5% year-over-year to 1.58 million metric tons, according to Vietnam’s National Statistics Office data released in early January. This surge in Vietnamese shipments has directly pressured global robusta prices downward.

Looking ahead, Vietnam’s coffee production is projected to climb 6% year-over-year to 1.76 million metric tons, or approximately 29.4 million bags, marking a 4-year production high. The Vietnam Coffee and Cocoa Association (Vicofa) indicated that output could reach 10% higher levels in the 2025/26 cycle if favorable weather conditions persist, signaling ample supply prospects that challenge the near-term outlook for robusta coffee futures.

Production Forecasts and Supply Abundance

Brazil’s crop forecasting agency, Conab, substantially raised its production outlook on December 4, increasing the 2025 total coffee production estimate by 2.4% to 56.54 million bags, up from a prior September estimate of 55.20 million bags. This upward revision underscores mounting supply abundance, a key bearish factor for coffee prices across both arabica and robusta varieties.

The USDA’s Foreign Agriculture Service (FAS) projected in mid-December that global coffee production in 2025/26 will increase 2.0% year-over-year to a record 178.848 million bags. While arabica production is expected to decline 4.7% to 95.515 million bags, robusta output is forecast to surge 10.9% to 83.333 million bags. Vietnam’s share of this robusta expansion is substantial, with FAS forecasting a 6.2% year-over-year increase to 30.8 million bags.

Global Inventory Dynamics and Price Pressure

ICE-monitored arabica inventories, while hitting a 1.75-year low of 396,513 bags in mid-November, have since recovered to a 3.25-month high of 461,829 bags by early January. Similarly, ICE robusta coffee inventories fell to a 13-month low of 4,012 lots in December but subsequently recovered to a 2-month high of 4,662 lots, signaling inventory rebuilding that continues to pressure robusta coffee futures.

The recovery in exchange-monitored stocks reflects improving supply availability and dampens supply-side bullish arguments. However, Brazilian coffee export data revealed a December contraction, with total green coffee exports declining 18.4% to 2.86 million bags, while robusta shipments fell 61% year-over-year to 222,147 bags. This export weakness provides some counterbalance to the broader supply-supportive environment.

Market Outlook for Robusta Coffee Futures

The International Coffee Organization (ICO) reported in November that global coffee exports for the 2025/26 marketing year fell 0.3% year-over-year to 138.658 million bags, suggesting a tightening in near-term trade flows. However, FAS projects 2025/26 ending stocks will decline only 5.4% to 20.148 million bags from 21.307 million bags in 2024/25, indicating adequate buffer supplies that will likely continue to constrain robusta coffee futures.

The combination of robust production forecasts, rising Vietnamese supply, adequate rainfall in Brazil, and recovering global inventories creates a structurally bearish backdrop for robusta coffee futures. Unless demand accelerates significantly or production forecasts face meaningful downward revision, the pressure on coffee prices appears likely to persist in the near to medium term.