FX.co ★ Arabica Coffee Futures Up

Arabica coffee futures have climbed to approximately $3.55 per pound, bouncing back from a recent four-week low of $3.46. This upward movement is primarily driven by fluctuations in currency values, supply chain dynamics, and weather patterns affecting major coffee-producing regions. Notably, the persistent strength of the Brazilian real is acting as a deterrent for coffee producers in Brazil, reducing their incentive to engage in export activities. Analysts have observed that the decline in Brazilian grain exports projected for 2025 continues to exert downward pressure on prices. According to a report from Cecafé dated January 19, there was an 18.4% year-over-year decrease in Brazilian green coffee exports in December, totaling 2.86 million bags. Specifically, Arabica shipments dropped by 10% to 2.6 million bags, while Robusta shipments dramatically declined by 61% to 222,147 bags. Additionally, diminishing supplies from Colombia have exacerbated the situation. A recent analysis by Itaú BBA suggests that in the upcoming months, coffee prices will likely remain vulnerable to unstable weather conditions—primarily marked by below-average rainfall and extreme heat—as well as the prevailing geopolitical climate.