Good day. Welcome to DRWakefield’s Weekly Coffee Market Report!
This report touches upon the Arabica and Robusta coffee futures market, currency pairings and news from origin. See our Market Report Terms page for clarity on any terminology in the coffee market report below.
Live Market Data
Coffee Market Report 28/04/2025
This report covers the period from Monday 14th April to Friday 25th April and was written by Phil Searle. This report covers the past two weeks of market activity.
Coffee Market
April 14 to 17: After closing lower the previous week, coffee futures prices rebounded last week. Despite no significant changes in fundamentals, the market was primarily influenced by macroeconomic and technical factors, resulting in a 5.4% increase compared to the previous Friday’s close. In the latest COT report, funds reduced their position by 1,200 lots, maintaining a long position of 24,300 contracts. Both markets registered gains over the week, reflecting tight supply conditions in the physical market.
April 21 to 25: NY continued to close higher for most of the week. We observed a large range of 35c/lb in daily closes. On Friday, the trade was on edge of their seats as the market opened at 396.55, surged to 410.50, and closed 1.05 above the opening. Fundamentals continue to support the market above 360. The Jul/Sep switch reflects limited stocks, being 7.05c/lb at the time of writing. Exporters and importers are likely to continue holding limited stocks due to high market volatility and the negative switch.
COT & Certified Stocks
↑ Non-Commercials increased their net long position by 1,355 lots
↑ Commercials increased their net short position by 480 lots
Origin
Crop estimates are increasingly divergent in Brazil, with arabica struggling against persistent climate risks while robusta thrives. Brazil’s ability to manage this duality will be crucial in offsetting arabica deficits and leveraging robusta’s cost benefits. Producers need to focus on irrigation, clone diversification, and risk hedging to stabilise margins in a more volatile climate.
Fresh crop continues to arrive in Addis, albeit in smaller volumes, primarily due to the amount already shipped. Ethiopia has reached a historic milestone, exporting 299,607 tons of coffee over the past nine months, a 72% increase compared to the same period last fiscal year. The top importing countries this year have been Saudi Arabia, Germany, and the USA.
Kenyan coffee flow is slowing down as the season approaches its end. Fly crop is due to begin in May. Food-grade containers remain in desperate need due to ongoing shortages.
Currency & Macro Outlook
GBP/USD
The US Dollar faced renewed pressure after Trump announced that some reciprocal tariffs introduced earlier in the month would take effect within weeks. Volatility surrounding Trump’s trade policies continues to impact the ‘greenback,’ suggesting that Jerome Powell is not the only “major loser” in the current market.
The GBP strengthened against the Dollar due to a 0.4% increase in UK sales in March. Bank of England’s Megan Greene stated that US tariffs would likely lower, rather than raise, inflation in the UK, although uncertainty persists regarding their full impact. She noted that confusion remains about the eventual effects of tariffs once conditions stabilise.
Coffee Market Report 15/04/2025
This report covers the period from Monday 4th April to Friday 11th April and was written by James Duncan.
Coffee Market
Well, there’s certainly not a shortage of movement in coffee this week. The sell off from the previous Friday continued into the start of the week where we saw the market open at 362.50 c/lb and close at 344.80 c/lb. The main headline here is the T word (I’ll let you decide whether that’s Trump, Tariffs, or Trade war). News of a 90 day pause briefly roused the market, but after the White House denied this, coffee futures continued to sink.
This downward trend continued until Wednesday where we saw a massive range of 28.55 c/lb between the low and the high, yet it closed a mere 0.55 c/higher than open. This time, the 90 day pause on tariffs turned out to be true – but with the announcement coming so soon before market close, and lacking details – traders had little time to respond.
By the time the market opened on Thursday, traders were privy to more details, and it opened 20 c/lb up. This was eroded throughout the day, closing just over 1 c/lb higher than Wednesday. The lack of upwards moment off the back of the morning’s massive jump is telling of specs hesitancy to buy given the current uncertainty.
Friday saw mostly steady prices in the morning, before Americans coming online drove the price up in the afternoon, closing out at 357.70 c/lb – 14 c/lb up from Thursday close but 4.8 c/lb down from Monday open.
COT & Certified Stocks
↓ Non-Commercials reduced their net long position by 9294 lots
↓ Commercials decreased their net short position by 13,524 lots
Origin
For the current crop (2024/25), broker BMI now expects global production to reach 174.4 million bags – an increase of 3.7% year-on-year. However, forecasts for the 2025/26 crop aren’t looking as positive currently. Conab are due to publish their second official Brazil forecast on 6th May – the first predicted a 4.4% year-on-year decline in production. Stonex revises this at a more moderate 2.1% decline, while Cooxupé (one of the largest exporters in Brazil) is anticipating a 10% drop in their own exports. Brazil’s Minas Gerais region received just 17.9mm of rainfall last week, accounting for 89% of the historical average. While note crop defining news in and of itself, small variances from the norm can account for large swings in today’s volatile market.
Robusta meanwhile is experiencing somewhat of a resurgence, with global estimates ranging from 17-22% up on last year. Individual origin’s estimates from Marex range from +7.9% for Vietnam to +13.6% for Brazil’s Conilon. Although this news sounds positive on the surface, Vietnam has had a series of bad crops with negative year-on-year growth, and this predicted increase will not bring us back to pre-2023 levels.
Currency & Macro Outlook
DXY
After a brief excursion into actual coffee news, we are back to President Trump and his big Ts. The main headline here is that the US dollar index, which evaluates the strength of the dollar by comparing it to a basket of other strong currencies, fell from around 103 to below 100 at one point on Friday. This caused the £ to break through the 1.30 £/$ mark, while the € stayed stable throughout the week. One of the largest gains against the dollar has been the Swiss Franc (CHF) rising from 1.17 to almost 1.22 in a week, as investors rush to try and determine a new reserve currency.
GBP/USD
While the $ looks set to dominate the markets for a while to come, market turmoil typically encourages investors to take their money out of their risky assets and keep their money in USD – widely seen as a ‘safe currency’. The fact that the dollar is weakening at the same time as a volatile market shows possible hints at the US losing it’s dominance as the global reserve.
Coffee Market Report 07/04/2025
This report covers the period from Monday 31st March to Friday 4th April and was written by Hannah Wakefield.
Coffee Market
The market opened on Monday 31st March at 380 c/lb, ready for another week of volatility! Monday’s high hit 386.40 c/lb, and low 378.55 c/lb, a range of 7.85 c/lb. This time last year this would have been a notably volatile day of trading, but in our brave new world where we are frequently seeing daily ranges of 20 c/lb, this is small change. After closing at 379.75 c/lb, almost exactly the same as open, the next day was a different story, seeing a range of 19 c/lb, closing higher at 389.05 c/lb, close to the high of the day.
Wednesday 2nd April started quiet with minimal movement, but picked up in the afternoon hours to hit the week’s high of 393.70 c/lb, before cooling off and closing a touch lower than open at 388.85 c/lb. This is a trend we have been noticing more keenly recently where trading becomes more volatile in the afternoon when the US traders have come online.
On Thursday 3rd April, the coffee market was caught up in a wider liquidation that happened across commodity markets in response to President Trump’s announcement of an executive order to implement reciprocal tariffs on the US’s trading partners. This news saw the market fall to 376.90 c/lb, only just above the technical support level of the 50 day moving average. Although it recovered almost ten cents before closing at 385.25 c/lb.
Friday 4th April was the most notable trading day of the week. Opening at 386.55 c/lb, hitting highs of 389.35 c/lb before plummeting to lows of 364.90 c/lb and closing just above at 365.70 c/lb, 14.30 c/lb below the open of the week, with a daily range of a massive 24.45 c/lb. This bearish pressure was largely driven by the impact of tariff announcements plus the effect that has had already on the stability and valuation of the Brazilian Real and Colombian Peso.
Origin
The main news and concerns from across origins we are hearing is in relation to tariffs.
Brazil and Colombia are now subject to the baseline tariff of 10% when importing goods into the US, as of 5 April 2025. Fears at origin that this will impact demand for coffee, on top of the already record breaking high prices importers and roasters are currently paying. Currently around 60% of coffee imported to the US comes from these two countries. With 1.36 million tonnes imported in 2024. Both of these countries are big Arabica producers, which has historically accounted for 90% of US consumption.
Fears that tariffs on Arabica producers may push demand towards Robusta consumption, are likely to be unfounded. Vietnam, the world’s biggest producer of Robusta, has been hit with one of the highest tariffs from Trump, at an enormous 46%, potentially adding an extra 2500 $/MT to the price of Vietnamese Robusta being brought into the US.
The story is much the same for Indonesia, who are a key Robusta and Arabica player, and rank fourth in global coffee production. They are facing a tariff of 32%, another of the higher tariffs being proposed. Phil and Henry, two of our Senior Traders, are returning from Sumatra in Indonesia this week, say producers and exporters on the ground are very worried about the repercussions of this, fearing it may severely impact the global demand for their coffee if they become too expensive for US importers to consider. The impact of this is potentially significant as currently the US is the biggest buyer of Indonesian coffee.
Currency & Macro Outlook
I last wrote this report 1 month ago, and back then the main focus was on Trump and his tariffs and one month later we’re still very much in tariff town, with the repercussions being felt across the globe, and so also across the whole coffee industry. The reasoning behind these tariffs is to boost the US economy by encouraging businesses and consumers to purchase domestically made or grown goods. Whether one may agree or disagree with this tactic, one thing is for sure, domestically-grown coffee production will not be able to meet the US demand by quite some way. Currently only 0.2% of coffee consumed in the US is grown there (mostly in Hawaii and California)!
The instability has also impacted the GBP/USD exchange rate. The uncertainty drove the value of GBP to a 6-month high surpassing 1.32 USD. This was a direct result of fears that Trump’s tariffs will plunge the US into a recession. Although, this was not too long lived, data released from US payroll surpassed expectations, adding 228,000 jobs to the economy in March, and hourly earnings increasing 0.3%, up 3.8% year on year overall. This helped the USD rebound slightly, levelling the exchange rate closer to 1.30 UD for 1 GBP. Further fears in the UK reverberate as hope wanes for a UK-US trade deal
