Weekly Market Report – 24 May 2026

As anticipated coffee prices on both markets came under further pressure this week but those concerns were muted by dry weather in Vietnam and possibly in Brazil later in the year.   Over the week arabica coffee prices lost 2.10 cents/lb, with the second position (September) closing at 264.80 cents/lb.  Robusta coffee prices, despite a strong bounce on Friday, ended the week down $55/ton (2.50 cents/lb) to finish the week at $3,310/ton (September).  In the absence of local market distortions, roadside parchment coffee prices in Papua New Guinea next week will probably be about 20 toea/kg lower than they were last week.

CONAB published their second survey of Brazil’s 2026 coffee crop this week, predicting that the country’s total crop this year will be 66.7 million bags.  This is 18% higher than what they forecast Brazil produced last year and a bit higher than their original forecast for this year of 66.2 million bags.  They attribute part of this growth to a 4% increase in the total area under coffee cultivation as well as an increase the national average crop yield which they believe will be 13% higher at 34.4 bags per hectare.  Arabica production is put at 45.8 million bags, while the conillon crop is estimated at 20.9 million bags.  The USDA have issued a wave of different crop forecasts from their agricultural attachés this week, suggesting that most of the origins reported on will show sizeable increases in their output over the next 12 months.  Vietnam’s crop is forecast at 32.5 million bags up 0.8 million bags from last year and comprising 31.4 million bags of robusta and 1.1 million bags of arabica. They also revised upwards their estimate for 2025/26 coffee production to 31.7 million bags, (30.5 million bags of robusta and 1.2 million bags of arabica).  Colombian coffee production has been estimated at 13.4 million bags, up 7% on last year.  Ugandan output has been put at 7.1 million bags, 6.0 million bags of robusta and 1.1 million bags of arabica.  Peru’s production has been put at 4.78 million bags, up 1%, Tanzania’s at 1.6 million bags, up 10% while Kenya’s coffee production is put at 950,000 bags, up 12%.  However, Indonesia’s coffee production is forecast to decline by 8% to 11.38 million bags, driven down by lower yields.

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.  Once again physical price differentials appear to be largely unmoved with Brazilian 3/4’s continuing to be quoted at minus 10. Honduras HGs remain at plus 18, while Kenya AB FAQ’s are steady at between plus 47 and plus 50; but Colombian UGQ’s are up a cent at plus 39. I therefore suspect that PNG Y1’s may be unmoved at around plus 7/8.  If this is still correct, then, it should have been possible for an exporter to have fixed on Friday in New York for Sept/Oct delivery at a price somewhere between 262.80 cents/lb and 274.00 cents/lb.   In some ways the small downward move seen this week was a bit of a surprise, but the US NOAA estimated this week that there is a 82% probability that an El Niño will emerge between May and July and persist through the end of the year, with a 67% chance of a “Super El Niño”.  This may delay rains in Brazil during September and October, when tree flowering normally occurs, causing real damage to Brazil’s 2026/27 coffee crop.  Whether this threat will be enough to keep prices where they are now is probably unlikely, but I suspect will slow the rate of any decline.  Prices will, therefore, probably be lower next week but not by much.     

Source:
Mick Wheeler, UK.

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