Arabica coffee prices rise as ICE stocks approach 1990s lows
Arabica futures gained almost 10% in two sessions as heavy rain delayed Brazil’s harvest and ICE-certified stocks continued to fall. USDA still forecasts more than 70 million bags for Brazil, but immediate availability and bean quality remain uncertain.
Immediate shortages outweigh Brazil’s harvest outlook
Arabica coffee futures rose almost 10% in two trading sessions as buyers reacted to declining exchange stocks, harvest delays in Brazil and persistent shipping disruption. Economica.net, citing an analysis by XTB Romania, reported that demand strengthened in recent days and coffee recorded its largest price increases in some time, despite having lost value since the beginning of the year.
The rally contrasts with an optimistic production outlook for Brazil, the world’s largest coffee producer. The US Department of Agriculture continues to forecast a Brazilian crop of more than 70 million bags. Estimates from Brazilian institutions, including crop agency CONAB, are more cautious. The immediate issue for the market is not potential production on paper, but how quickly suitable beans can be harvested, processed and delivered.
Heavy rain disrupts harvesting and drying
Minas Gerais, Brazil’s largest Arabica-producing region, received slightly more than 32 millimetres of rain in one week, equivalent to 2,700% of the historical average for the period, according to the analysis. The unusually intense rainfall is obstructing harvesting, drying and transportation.
Even if Brazil ultimately produces a large crop, delays mean that much of the coffee has not yet reached the market. Excess moisture may also reduce bean quality. That distinction is important for ICE inventories because coffee delivered against Arabica futures must meet the exchange’s requirements. A record crop would therefore not automatically replenish certified stocks if insufficient volumes satisfy the relevant quality standards.
ICE inventories fall below a critical threshold
ICE-monitored Arabica stocks recently recorded a one-day decline of 5.9%, their largest since the beginning of 2025. Across more than 25 consecutive trading sessions, inventories fell by as much as 26%, XTB Romania said. Historical stock curves indicate that reserves are approaching levels not seen since the period spanning the 1990s and 2000, below 300,000 bags.
This depletion has sharpened concern among roasters and physical buyers that warehouses could run out of immediately deliverable coffee. The spread between September and December futures widened to a record of more than 24 cents per pound. Buyers are paying a substantial premium for nearby delivery, while contracts for later years remain considerably cheaper. That price structure points to anxiety over short-term supply rather than an expectation of a lasting global production deficit.
Shipping bottlenecks extend delivery times
Tensions in the Red Sea are adding another constraint. Longer vessel transit times, higher freight costs and the need for logistics companies to hold larger buffers are delaying deliveries to consuming markets. El Niño typically brings excessive rainfall to South America and drought to Southeast Asia; for Brazil, that could support crop development while making fieldwork and logistics more difficult.
The direction of prices now depends on whether Brazil’s crop can reach the market quickly enough and in the required condition. XTB Romania analyst Radu Puiu said the futures curve suggests the market does not expect supply to remain a problem over the longer term. If rising production begins rebuilding inventories, the arrival of harvested coffee could start affecting prices from the autumn. Until then, low certified stocks and delays leave roasters, traders and importers exposed to high premiums for prompt supply.