Arabica Coffee Plant Growth Outlook Clouded by Mixed Global Weather and Supply Shifts

Arabica coffee markets faced notable pressure this week as traders weighed competing signals from major producing regions worldwide. March arabica contracts retreated by 1.57% during Thursday’s session, while robusta coffee showed modest gains of 0.82%. The divergent performance reflected contrasting weather developments across the world’s two largest coffee-producing nations, with implications extending well beyond near-term pricing.

Weather’s Dual Impact on Regional Arabica Coffee Plant Production

The arabica coffee plant’s sensitivity to precipitation became a key market driver as rainfall forecasts dominated trader sentiment. Brazil’s Minas Gerais region—which accounts for the bulk of global arabica supplies—faced expectations of consistent rainfall over the coming seven days. This weather outlook created headwinds for arabica coffee valuations, as adequate moisture conditions typically support crop development but weigh on near-term prices by reinforcing supply confidence.

In contrast, Vietnam’s Central Highlands—home to the world’s dominant robusta production zones—experienced forecasts suggesting limited precipitation ahead. This drier outlook lent support to robusta futures, creating a temporary divergence between the two arabica and robusta trajectories. The region-specific weather dynamics underscore how arabica coffee plant development remains fundamentally tied to seasonal precipitation patterns and climate volatility.

Inventory Dynamics: Recovery Erodes Price Support

A significant complication emerged from ICE-monitored coffee warehouse levels. Arabica inventories, which had contracted to a 1.75-year low of 398,645 bags in mid-November, rebounded to 461,829 bags by mid-January—marking a 2.5-month high. Similarly, robusta warehouse stocks reversed earlier declines, climbing from a 1-year low of 4,012 lots in December to 4,609 lots by late January. The recovery in stored supplies represents a headwind for prices, suggesting market tightness concerns have eased considerably.

Production Expansions Overshadow Tighter Export Activity

Brazil’s crop forecasting agency Conab elevated its 2025 production estimate by 2.4% to reach 56.54 million bags, up from the 55.20 million bags projected in September. This upward revision underscores robust arabica coffee plant output potential for the current cycle. However, Brazilian export performance painted a more constrained picture: green coffee shipments fell by 18.4% in December to 2.86 million bags, with arabica-specific exports declining 10% year-over-year to 2.6 million bags.

Vietnam’s situation presented the inverse dynamic. The nation’s 2025 coffee exports surged 17.5% year-over-year to 1.58 million metric tons, driven by ample supplies and strong buyer demand. Vietnamese robusta production is projected to climb 6% annually to 1.76 million metric tons—equivalent to 29.4 million bags—potentially marking a 4-year production peak.

Global Supply Trajectory: Record Output Despite Arabica Pressures

The U.S. Department of Agriculture’s Foreign Agriculture Service delivered its latest projections for the 2025/26 marketing year in mid-December. Global coffee production is forecast to increase 2.0% year-over-year to an all-time record of 178.848 million bags. However, this aggregate growth masks underlying compositional shifts: arabica production is expected to decline 4.7% to 95.515 million bags, while robusta supplies will surge 10.9% to 83.333 million bags.

On a country-specific basis, Brazil’s 2025/26 arabica coffee plant output is projected to fall 3.1% to 63 million bags, reflecting a production cycle correction. Vietnam’s robusta coffee output is anticipated to rise 6.2% to a 4-year high of 30.8 million bags, cementing the nation’s supply dominance in robusta varieties.

Market Implications and Outlook Ahead

These production forecasts suggest an emerging supply imbalance between arabica and robusta segments. While global coffee ending stocks are projected to contract 5.4% to 20.148 million bags by the close of 2025/26—down from 21.307 million bags previously—the concentration of production growth in robusta varieties leaves arabica coffee plant supplies relatively exposed to demand fluctuations. The arabica market faces a challenging backdrop where supportive weather in Brazil provides medium-term reassurance, yet near-term inventory recovery and Brazilian export softness create near-term price constraints.