Arabica coffee futures dropped to their lowest level in 1½ years on ICE on Friday, extending a sharp weekly decline as expectations of strong supply from Brazil weighed heavily on the market.
Coffee Prices Under Pressure
Arabica coffee futures fell about 0.8% to around $2.45 per pound, briefly touching their lowest level since late 2023. The contract is now down roughly 7.7% for the week, marking a notable correction after previous supply-driven volatility.
The main driver behind the decline is expectations of a near-record Brazilian harvest, which is set to significantly increase global supply. Brazil’s coffee output for the 2026/27 season is projected at 71.9 million bags, up from 63 million bags previously, according to the USDA.
Weather conditions are also supporting harvest progress. Forecasts show mostly dry conditions in Brazil’s key coffee-growing regions, allowing for efficient harvesting and adding further downward pressure on prices.
Robusta coffee also declined, falling about 1.2%, reflecting broader weakness across the coffee complex.
Cocoa Market Also Weakens
Cocoa prices also moved lower, with both London and New York contracts falling around 3.3%. Weak demand continues to weigh on sentiment, though some traders expect a recovery later in the year.
At the same time, longer-term concerns remain in play. Market participants are watching potential El Niño weather conditions, which could disrupt cocoa production in West Africa in the upcoming 2026/27 season and provide a longer-term support floor.
Sugar Moves Higher
In contrast to coffee and cocoa, raw sugar prices rose around 0.8%, putting them on track for a weekly gain. Traders are closely monitoring the monsoon season in India, the world’s second-largest sugar producer, where a slow start has raised early concerns about crop conditions—though it is still too early for firm conclusions.
White sugar prices edged slightly lower in contrast, reflecting mixed sentiment across the broader soft commodities complex.
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