December Market Report

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 29/12/2025

This report covers the period from Monday 22nd December to Friday 26th December and was written by James Duncan.

Coffee Market 

Following the previous week’s losses, the market rebounded somewhat last week: opening at 341.10 usc/lb and closing out at 350.25 c/lb. Monday 22nd December saw the most action on an expectedly quiet week, with roasters looking to capitalise on the dip in the market. This drove the price up, breaking the 6-day bear run, but met resistance at 350 usc/lb as origin selling picked up. Tuesday and Wednesday saw modest losses of 0.40 and 1.80 usc/lb respectively vs. previous day close, as volume fell in the lead up to Christmas. After closing on Thursday 25th December, the market rallied on Friday with news of a heatwave in coffee growing regions of Brazil. The upside was limited by the strengthening Brazilian Real, which encouraged origin selling.

The London Robusta market was only open Monday 22nd – Wednesday 24th December this week, as Friday 26th was a bank holiday here in the UK. Robusta posted gains every day as reports of flooding in Indonesia, the third largest producer of Robusta, is expected to reduce exports by double digit percentage points.

Origin

Many Origins also celebrated Christmas last week, with varying public holidays ranging from 24th – 26th December, while others, such as Ethiopia celebrate Christmas, and its public holiday, in January. As such, news from origin was limited last week, and mostly meteorological; including reduced rainfall in Brazil, where they are also experiencing a heatwave, and the continued effects of the heavy rain in southeast Asia (primarily Indonesia and Vietnam).

Currency & Macro Outlook 

GBP/USD and EUR/USD posted gains in the early part of last week, despite the rate cuts from the BoE earlier in December and weak UK economic data. The gains in GBP are instead better explained by the losses on USD, based on predictions of another Fed rate cut in the new year. This momentum was amplified by concerns that President Trump intends to appoint a Dovish Fed Chair in the new year, which would not only increase the odds of a rate cut but also destabilise the dollar as the unwritten independence of the Fed comes under threat.

Coffee Market Report 23/12/2025

This report covers the period from Monday 15th December to Friday 20th December and was written by James Duncan and Hannah Wakefield.

Coffee Market 

Last week saw the Arabica market post 5 days of consecutive losses – opening at 368.00 c/lb and ending the week at 340.65 c/lb. The COT report, published after market close on Friday 12^th December, showed that managed money reduced their net long position – an indication that the momentum of the market may be changing. This, along with the downwards momentum from the previous week, likely drove the further selloff on Monday 15^th December. Both speculators and commercials have capitalised on the market, with trading volume amongst these groups being the highest since mid-November. Origin sellers were mostly absent from last week’s activity.

Rainfall in Brazil’s coffee growing regions eased concerns about crop development and certainly provided some downward pressure in the market last week. Elsewhere, the USDA released its updated coffee production forecast for 25/26 on Thursday 18^th December. A 2% increase in world coffee production was detailed compared to last year – with Vietnam, Indonesia, and Ethiopia offsetting the reductions in Brazil and Colombia forecasts.

Origin

The ELN, a guerilla group in Colombia, have made the news for multiple reasons over the last week. They are the oldest guerilla group in the Americas, having been started in 1964. They are present, and wield influence, in over 20% of Colombia’s municipalities (including coffee-producing regions), and often use violence to promote their interests. From Sunday 14^th December at 6am, and for the following 72 hours, ELN declared an armed strike where citizens were told to stay indoors so not to get caught up in military exercises. The ELN have been more active recently in response to what they consider ‘threats of imperialist intervention’ from Donald Trump. However, following this, the ELN have declared a ceasefire over the festive period (24^th December to 3^rd January), hopefully offering some respite. The impact of the ELN’s actions on coffee, for the most part, is causing delays and disruptions for internal logistics due to the increased risk.

In Indonesia, the impact of the flooding is still being keenly felt, with many communities still being cut off. In terms of coffee, it is still too early to assess the impact, but farms, stocks in warehouses and infrastructure have all been heavily affected. Therefore, we will see a significant delay in coffee being exported. Despite the huge disruption, the Robusta crop in Indonesia is looking positive. Production is up 1.7 million bags year on year, to a total of 11 million bags. Indonesia is the third largest producer of Robusta in the world, after Vietnam and Brazil. Robusta is grown across the archipelago, on Sumatra it is more heavily grown in the south of the island and there is more Arabica in the north. The North has been more severely affected by the flooding.

EUDR – On Wednesday 17^th December, the EU Parliament voted to approve the changes to the EUDR legislation. This includes simplifying some of the regulations and postponing the enforcement date for 12 months. Large operators and traders now have until 30^th December 2026, and small operators have until 30^th June 2027.

Currency & Macro Outlook 

The Bank of England implemented a much-anticipated rate cut last week, to little affect on the GBP/USD rate as it is expected that the Fed will similarly cut rates in December. Faith in the USD seems to have reduced in weeks as shown by US Dollar Index (currently below 98.5) and an increased interest in ‘safe’ assets like Gold. Geopolitical instability surrounding the US/Venezuela dispute, along with the anticipated rate cuts, have been identified as the likely cause.

The Euro remained steady last week, as the ECB diverges in policy compared to the Federal Reserve, choosing to maintain interest rates for the foreseeable. The outlook for the Eurozone’s economy has also been revised upwards of late, leading to renewed interest in the currency pair.

Coffee Market Report 08/12/2025

This report covers the period from Monday 8th December to Friday 12th December and was written by James Duncan and Hannah Wakefield.

Coffee Market 

Coming off the back of a slow trading week, interest in the Arabica market picked back up again on Monday 8th December with over 25,000 lots traded. Breaking through the 50-day moving average support of 372.39 c/lb, we hit the low for the week at 364.85 c/lb before closing out at 366.20 c/lb, a change of -2.31% on open. Tuesday saw the market bound around a 7 c/lb trading range but failed to find direction and ultimately closed not far from the open. By mid-week, we started to see some more action in the market with both Wednesday and Thursday posting roughly 1% gains on the open, likely in reaction to Cecafe posting 27% decrease in Brazil’s November exports compared to last year. Speculative buying pushed the market up, with origin selling keeping the prices from going too high. All of this was undone on Friday, as concerns of reduced supply were eased by rains in Brazil, with the session closing out at 369.30 c/lb, just above Wednesdays open. 

The Robusta market continued its downwards trajectory, posting 1.95% and 2.53% decreases on Monday and Friday respectively. Opening the week at 4,150 $/MT, we briefly regained Monday’s losses mid-week before closing out just under 4,000 $/MT on Friday (literally: 3,999 $/MT). Most of the movement last week hinged on improved weather in Vietnam, as well as projections of both Vietnam and Brazil’s crop year on year. 

Origin

News of the upcoming Brazilian crop 25/26 remains varied depending on who you talk to or which report you are looking at. Last week USDA (the United States Department of Agriculture) published a report which estimated the crop will be 2 million bags lower than last year, an estimate that is also significantly lower than CONAB’s recent estimate. USDA have lowered their estimate for Arabica by 2 million bags, and increased their Robusta estimate by 900,000 bags. Whilst the figures between different estimates differ, what is consistent is that there will be less Arabica than last year, and a good deal more Robusta, with a record Robusta crop anticipated. This comes about as the fruition of heavy investing in planting Robusta trees in Brazil over recent years. Whilst Robusta is, as its name suggests, a more robust plant than Arabica, it is worth noting that about 70% of Brazilian Robusta is irrigated, providing a lifeline during low rainfall. In terms of weather, the outlook remains uncertain, with the country experiencing more erratic and unpredictable weather patterns.  

It is now harvest time for the fresh crop in Guatemala; first arrivals in the UK / Europe will be in March 2026. We have heard from our partners that it is not looking as good as they had hoped, particularly in the western parts of the country, although the volume is expected to be below average in the eastern parts too. That being said, we have heard from Nueva Granada that their trees are looking healthy, which is positive news moving forwards. Currently weather is looking good for the harvest period as well.  

The crisis in Indonesia is still ongoing, with flash flooding and landslides across Sumatra. Our thoughts are with those affected. 

Currency & Macro Outlook 

The GBP/USD rallied last week upon the expectation of a Fed rate cut, topping out at above 1.342 on Thursday, 11th, before pulling back slightly on Friday after some profit taking, as well as caution surrounding upcoming UK economic data, as well as an expected rate cut from the BoE this week. The Euro similarly strengthened against the dollar at the beginning of the week, but without the decrease experienced by the sterling on Friday. This has been largely attributed to both the 1.8% MoM rise in industrial production reported in Germany, as well as an anticipated pause in rate cuts from the ECB this month. 

Coffee Market Report 08/12/2025

This report covers the period from Monday 1st December to Friday 5th December and was written by James Duncan and Hannah Wakefield.

Coffee Market 

Volatility in the market appeared to back off this week with the most active terminal, Mar ’26, broadly trading within the 370-380 usc/lb range. With many traders across the pond returning to the desk after the Thanksgiving Holiday, volume increased on Monday; initially selling off until we dipped below 372 usc/lb (the 50-day moving average), after which it picked back up and closed just shy of 380 (379.70 usc/lb to be exact, just above the 20-day moving average).

Tuesday 2nd December mirrored Monday’s trading in many ways; by which I mean it was reversed, not the same. Although the market opened down, it briefly ticked above 380 usc/lb due to short covering, but speculators betting on a close below 375 usc/lb won out in the end, driving the market down to close near to the 50-day MA at 373.45 usc/lb. Commercials seemed to mostly be trading out of the market this week, with many EFPs and EFSs reported to the market. If you are unfamiliar with what these are, don’t worry, just know that many commercials are choosing to settle outside of the Arabica market currently.

With little commercial activity, interest in the market reduced for the remainder of the week with the speculators seeming to play technical tennis between the 50 and 20-day MA. Thursday and Friday even saw London (Robusta market) overtake trading volume as the Robusta Jan terminal draws near. Bearish factors in the market include CONAB (Brazilian crop forecasting agency) upping their estimate for 2025 coffee production by 2.4%, while support is provided by below average precipitation in Brazil and dwindling ICE inventories.

While we don’t consistently comment on Robusta futures in this market report, I think it worth mentioning in brief this week as it was clearly the more interesting market. Closing lower every day last week, the daily range narrowed towards the end of the week towards 4,200. The market seems to be downplaying concerns in Vietnam, but continues heavy rains may prove problematic going forwards.

Origin

It is good news out of Honduras this week, as the harvest kicks off well. In early November it was estimated between 5% and 8% complete, and is currently projected to total 6.5 million 46kg bags, a 1% increase from last year. Ripening appears to be progressing as normal, and at the moment there are no major weather concerns. Honduran producers are still facing many challenges, however. One of the biggest is the availability, or lack thereof, of labour for harvesting, but also for maintenance throughout the year. On top of which, the cost of labour has increased by about 30% in 2025. Another challenge is managing the post-harvest processing. Our friends at Eleva Finca are offering training in best practices for cherry selection, wet milling, drying and storage, with the aim to standardise post-harvesting processing to improve quality.

News out of Brazil this past week has varied. Some reports claim that the main production areas have received good levels of rainfall, with predictions that these will continue for the remainder of December, meaning the outlook for next crop is positive. However, others disagree. Notably Vincente Zotti, managing partner of Pine Agronegocios, believes the next harvest to have already lost 3 million bags of potential production. And there is always the chance that even with good rainfall, if it is accompanied by high temperatures, then production may well be hampered still. Despite these contradictory reports, CONAB have raised their estimates for the 25/26 crop by 2.4% to 56.5 million bags, 4.3% on 24/25. Interestingly, when you break down the figures further into Arabica and Robusta, they have revised their Arabica estimates to 9.7% down on 24/25, and Robusta to an enormous 42.1% increase on 24/25. In short, the jury is still out on the 25/26 harvest.

The crisis in Indonesia is still ongoing, with flash flooding and landslides across Sumatra. Our thoughts are with those affected.

Currency & Macro Outlook 

The pound sterling made 0.9% gains against the dollar this week following stability in GBP following the Autumn budget, and a softening in USD leading up to the now expected December Fed rate cut. The euro posted more modest gains of 0.3% against the dollar, with mixed Eurozone data signalling the ECB won’t be making any further rate cuts.