US Coffee Market Prices Surge Today as Dollar Weakens

The global coffee market is posting impressive gains today, with US-traded arabica and robusta contracts rallying sharply following renewed weakness in the US dollar. This movement underscores the interconnected dynamics between currency markets and commodity pricing that traders monitor closely in the coffee sector.

Dollar Decline Triggers Short Covering Rally in Coffee

Recent weakness in the dollar index to its lowest level in 3.5 months has sparked substantial short covering across commodity markets, with coffee among the key beneficiaries. Arabica futures reached higher ground with a 0.92% gain, while robusta posted more aggressive moves with a 2.88% advance, marking the strongest performance in 1.5 months. When the dollar weakens against other currencies, commodities priced in dollars typically attract buying interest as they become more affordable for international purchasers. This fundamental relationship between currency movements and coffee valuations continues to shape trader positioning in today’s market.

Brazilian Supply Crunch Provides Price Support

Brazil, the world’s dominant arabica producer, is experiencing tighter export momentum that provides meaningful support to global coffee valuations. Recent export data reveals that Brazil’s green coffee shipments declined substantially, with arabica exports down on a year-over-year basis and robusta exports experiencing even sharper pullbacks. More significantly, Minas Gerais—Brazil’s premier arabica-growing region—received well below-average rainfall in recent weeks, registering only about half the historical precipitation average. This weather-driven supply constraint in the world’s top arabica region acts as a bullish factor for coffee prices today, as reduced production expectations tighten the global supply picture.

Vietnamese Robusta Surge Weighs on Market

Counterbalancing the Brazilian supply story, Vietnam’s coffee sector presents a more abundant picture. As the world’s largest robusta producer, Vietnam has reported surging export volumes with year-over-year growth approaching 18%, while production projections for the 2025/26 season point to output climbing approximately 6% year-over-year. Such expansion from the dominant robusta supplier introduces downward pressure on robusta prices, as ample Vietnamese supplies weigh on market sentiment. The divergence between tightening arabica supplies and expanding robusta availability reflects the bifurcated dynamics driving today’s US coffee market pricing.

Storage Levels Rise, Signaling Mixed Outlooks

Inventory dynamics present a more nuanced picture for the coffee market. While arabica and robusta stocks in exchange warehouses had reached multi-year lows several weeks prior, recent data shows inventories rebounding to intermediate levels. Arabica warehouse stocks climbed to 461,829 bags last Wednesday, while robusta inventories rose to 4,609 lots by Friday. This inventory recovery tempers some of the bullish sentiment from supply-side tightness, suggesting the market is gradually rebuilding buffer stocks even as production forecasts evolve.

2025/26 Season: Supply Surge to Test Market Balance

Looking ahead, the coffee market faces an intriguing tension between near-term dynamics and longer-term forecasts. Global production for the 2025/26 season is projected to reach record levels, with total output climbing 2% year-over-year. While arabica production is expected to decline modestly, robusta output growth should more than offset that pullback, with Vietnam and Brazil both ramping up output. These production forecasts suggest that despite today’s price strength in response to dollar weakness and Brazilian constraints, the fundamental supply picture for the broader 2025/26 season remains abundant. Traders navigating the US coffee market must balance today’s near-term bullish factors against the prospect of ample supplies materializing over coming months.