Weekly Market Report – 29 March 2026

Both markets continue to be volatile pulled in opposite directions in response to concerns over short-term shortages and the prospects of a potential surplus in the longer-term. In the end the fundamental outlook prevailed but only just.  Over the week arabica coffee prices lost 6.45 cents/lb, with the second position (July) closing at 295.90 cents/lb.  Robusta coffee prices also retreated, but again more modestly than that seen in New York, losing $52/ton (2.35 cents/lb) to finish the week at $3,516/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 lower than they were last week.

Although the war in the Middle East continues to play havoc with all commodity markets, creating uncertainty about its longer-term impact over global supply chains especially on oil flows, which in turn affect all other aspects of global trade, coffee prices settled lower this week amid expectations of a record Brazilian coffee crop.  Marex Group Plc on Thursday produced a forecast for a record 2026/27 Brazil coffee crop of 75.9 million bags, even higher than last week’s forecast from Sucafina of 75.4 million bags and much higher than Rabobank’s 71 to 72 million bags.  The latest data from the Coffee Board of India shows that from the start of the current coffee year in October until March 17, the country has exported 3.23 million bags of coffee, an increase of 28% from the 2.52 million bags exported in the same period last year.  Official data from China shows that the country imported 400,500 bags of coffee in January 2026, a substantial increase from the 264,166 bags imported in January 2025. However, the data also shows that imports during February fell back to 161,666 bags.  Nevertheless, the total imported over the first two months of the year was still 15% greater than that imported over the same period last year.  .A major new study published in Nature Food this week found that while coffee does add marginally to global deforestation, its effect is much smaller than many presume, with the researchers finding that staple crops, such as maize, rice and cassava are collectively responsible for more deforestation than coffee, cocoa, and rubber combined. 

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 have hardened with Brazilian 3/4’s now quoted at plus 20, however, Honduras HGs are steady at plus 17, as are Kenya AB FAQ’s at between plus 45 and plus 50; Colombian UGQ’s, on the other hand, are up at plus 40.  Consequently, I can only guess that PNG Y1’s may also be slightly higher at around plus 6.  If this is correct, then, it should have been possible for an exporter to fix on Friday in New York for July delivery at a price somewhere between 300.30 cents/lb and 309.00 cents/lb.   I would not call what happened this week a correction, but rather a temporary outcome in an ongoing tussle between the two opposing forces, of short-term tightness and a longer-term surplus.  That tussle is not over yet, but prices will, inevitably, start to trend downward as the weight of additional supplies of coffee starts to hit the market.  So, it is all a question of timing, and it is anyone’s guess when that tussle will start to ease.  While I do not expect that to be next week, I would not be surprised to see further, but minor, erosion in both markets.            

Source:
Mick Wheeler, UK.