Weekly Market Report – 12 April 2026

Another volatile week with prices dropping sharply on Tuesday, following the London robusta market being closed on Monday. However, the arabica market then spent the rest of the week marching steadily upwards to recoup all that it lost last week to end up where it was two weeks ago. Over the week arabica coffee prices gained 6.50 cents/lb, with the second position (July) closing at 295.90 cents/lb. Robusta coffee prices, however, failed to match arabica’s recovery and stayed in the doldrums for the remainder of the week, losing $107/ton (4.85 cents/lb) to finish the week at $3,239/ton (July). In the absence of local market distortions, roadside parchment coffee prices in Papua New Guinea next week will probably be about 60 toea/kg higher than they were last week.

Part of this week’s recovery in arabica coffee prices can be attributed to the strengthening of the Brazilian Real against the dollar, but some analysts are saying that some of the recovery seen this week can be put down to the buying activity of the large Hedge Funds which are rebalancing their portfolios. This does not entirely ring true as the latest Commitment of Traders Report suggests that the funds are reducing their overall long position while at the same increasing their net short position. However, that report only relates to the position on Tuesday and it could well be that they have indeed significantly increased their long position during the remainder of the week. Indeed, trading volumes were well up throughout the latter half of the week, which lends support to the proposition that the annual roll-over exercise currently being undertaken by the index funds is behind the increase. On the other hand, it could be that the big drop on Tuesday reflected the optimism that the Straits of Hormuz would reopen with the apparent ceasefire being agreed, only to rebound when it became clear that the Straits would remain closed. Late last week the Custom Authorities in Vietnam released coffee export data, which showed that March coffee export shipments rose by 18.6% year‑on‑year to approximately 3.62 million bags. On a cumulative basis, exports during the first six months of the 25/26 coffee year (Oct/Mar) reached 14.92 million bags, up almost 24% on the same period last year. This may be why robusta prices did not follow arabica up.

Once again, I cannot get access to any reliable regularly-published data on price differentials, so I have had to rely on sources which may not be entirely accurate or up to date. Physical price differentials appear to have stabilised with Brazilian 3/4’s for immediate shipment quoted at plus 22, but for July/December shipment more realistically at minus 10. Honduras HGs are steady at plus 19, as are Kenya AB FAQ’s at between plus 47 and plus 50; Colombian UGQ’s, are also unmoved at plus 40. As a result, I suspect that PNG Y1’s may also be unmoved at around plus 8. If this is correct, then, it should have been possible for an exporter to have fixed on Friday in New York for July delivery at a price somewhere between 295.85 cents/lb and 304.90 cents/lb.

While geopolitical and technical factors might have taken centre stage this week, I do not believe that the markets will continue to ignore the fundamental outlook which increasingly looks as though Brazil will produce a bumper crop this year creating a global surplus. True stocks have fallen to a very low level and most of this surplus will merely replenish, but not entirely restock, the drawdown we have seen over the last 5 years, but it will alter the overall tone. Consequently, I believe that prices will move downwards next week, unless the war resumes.

Source:

Mick Wheeler, UK.

Latest Posts