Robusta Coffee Price Strengthens on Currency Weakness and Supply Disruptions

Recent market activity has delivered a sharp reversal for robusta coffee price, with the International Coffee Exchange contract surging +116 points (+2.88%) while its arabica counterpart (KCH26) climbed +3.20 points (+0.92%). This dual rally underscores a confluence of structural and macro factors reshaping coffee market dynamics. The acceleration in robusta coffee price reflects both technical momentum and underlying supply concerns that market participants can no longer ignore.

Currency Moves Ignite Broad Commodity Response

The recent pullback in the U.S. dollar index to a 3.5-month nadir served as the primary catalyst for the week’s commodity surge. As the dollar retreated, short positions across multiple commodities were liquidated, and robusta coffee price benefited from this technical unwind. When the dollar weakens, dollar-denominated commodities become more attractive to international buyers, creating an additional boost for price discovery.

Brazil’s Export Drought Reshapes Supply Calculus

Brazil’s coffee sector is grappling with a sharp contraction in shipments, a development that lends support to robusta coffee price amid tighter physical availability. According to Cecafe data, Brazil’s green coffee exports fell by 18.4% in December to 2.86 million bags year-over-year. The arabica segment experienced a 10% y/y decline to 2.6 million bags, while robusta shipments plummeted 61% y/y to just 222,147 bags—a dramatic reversal that underscores supply constraints.

Weather headwinds compound these export pressures. Somar Meteorologia reports that Minas Gerais, Brazil’s largest arabica-growing zone, received only 33.9 mm of rain during mid-January—merely 53% of historical norms. Below-average precipitation in the world’s top arabica producer remains a constructive factor supporting robusta coffee price as market participants digest potential production implications.

Vietnamese Supplies Create Downward Pressure

Vietnam’s robust output trajectory presents a counterweight to Brazilian constraints. Vietnam’s coffee exports surged 17.5% y/y to reach 1.58 million metric tons in 2025, driven by favorable growing conditions and expanded cultivation. The Vietnam Coffee and Cocoa Association (Vicofa) projects that 2025/26 production could climb 10% above the prior crop if weather remains cooperative, potentially reaching a four-year peak.

Yet this abundance, while bearish for long-term robusta coffee price stability, reflects a rebalancing of global supplies. Vietnam accounts for roughly 29% of anticipated global coffee output, with 2025/26 production estimated at 1.76 million metric tons by official forecasters.

Storage Dynamics Send Mixed Messages

Inventory movements present a nuanced backdrop. While ICE-monitored arabica stocks tumbled to a 1.75-year low of approximately 398,645 bags last November before rebounding to 461,829 bags recently, and robusta inventories recovered from a December low to 4,609 lots, these reversals highlight the market’s tug-of-war between production realities and storage dynamics.

Global Production Forecast: Shifting Ground Rules

The USDA Foreign Agriculture Service painted a more expansive supply picture in its December outlook. Global coffee production for 2025/26 is projected to reach a record 178.848 million bags, representing +2.0% growth. However, arabica production is expected to contract 4.7% to 95.515 million bags, while robusta output advances 10.9% to 83.333 million bags—a trajectory that could ultimately pressure robusta coffee price over the medium term.

Brazil’s crop is anticipated to decline 3.1% to 63 million bags, while Vietnam’s harvest is forecast to expand 6.2% to a four-year high of 30.8 million bags. Critically, 2025/26 ending global stocks are projected to fall 5.4% to 20.148 million bags, which may provide some scaffolding for robusta coffee price despite expanded production elsewhere.

The International Coffee Organization previously noted that global coffee exports for the current marketing year declined marginally by 0.3% y/y to 138.658 million bags, suggesting that near-term supply tightness remains an undercurrent in the market.

What’s Ahead for Robusta Coffee Price

The trajectory for robusta coffee price hinges on a delicate balance: Brazilian weather patterns and export recovery must be weighed against Vietnamese production abundance and the eventual working-down of global stockpiles. While near-term technical factors and currency dynamics have provided support, the fundamental outlook depends on whether production gains can be absorbed without sparking fresh supply surpluses. Market participants remain positioned to reassess robusta coffee price as fresh crop estimates and weather reports emerge through the growing season.