MILAN – Coffee futures prices fell yesterday, Wednesday 12 March, 2025, reflecting the volatility that characterises the markets. In New York yesterday, the May contract lost 1.8% to close at 386.75 cents. In London, the main contract (May) was down 0.8% (-$44) to close at $5,508. Meanwhile, ICE Arabica certified stocks rose to a 1-week high of 803,032 bags. ICE-monitored robusta coffee inventories also rose to a 1-month high last Friday of 4,356 lots.
An estimate released last week by Marex Spectron holds sway among industry insiders.
The influential British broker expects world coffee production of 170.7 million bags for the current coffee year, with consumption at 170.5 million.
Production will rise to 172 million in 2025/26, mainly due to the expected recovery in Vietnam, where the production will reach 29.8 million, up 2.2 million from 2024/25.
Brazilian production, which will fall by 1.5 million bags to 64 million. World consumption will increase slightly to 170.8 million, resulting in a small surplus of 1.2 million.
‘We are seeing a slight growth in demand in mature markets such as the US and Europe, and we have not yet seen the impact of price increases,’ said Andre Acosta, director of Marex Commodity Solutions Latam, quoted by Reuters.
‘On the other hand, in price-sensitive markets such as Brazil, we expect a reduction in demand, and further price increases could have a further impact on demand,’ he said during a presentation at the US National Coffee Association’s annual convention in Houston.
Jde Peet’s – the world’s leading pure-play coffee and tea company – announced in December price increases of as much as 30% in the Brazilian market during 2025. Brazil’s domestic consumption is close to 22 million bags.
What about coffee futures? According to Acosta, funds could sell some of the long positions held in the coffee futures markets over the next two quarters, if prices remain below their February peaks. But the picture – we add – remains extremely uncertain, suggesting a continued cautious approach.
Not least because the sword of Damocles of US tariffs always hangs over global trade. The NCA wonders what impact the Trump administration’s trade war with Canada and Mexico will have on the American industry.
In particular, the jumble of announcements, denials and revisions of protectionist measures is weighing heavily, destabilising investors and companies and creating a climate of extreme uncertainty, also given the strong integration between the US and Canadian markets.
Starbucks, for example, roasts the coffee used in its hundreds of Canadian stores in the US.
As for Mexico, it remains an important coffee supplier to the US, with an average of more than one million bags imported each year.
Bill Murray, president of the U.S. National Coffee Association, said coffee should be exempt from additional tariffs.
“Tariffs on coffee would impact three in four Americans. Many think exports, not imports, are good for America, but unfortunately we cannot grow coffee in the U.S,” he said in a statement reported by Reuters.
The concerns of the US industry are even greater as the axe of tariffs could also fall on other South American countries, where most imported coffee comes from.
“Trump, in one of his speeches about tariffs, mentioned Brazil, although superficially. Brazil is on the radar,” said Andre Acosta, director of Commodity Solutions Latam for broker Marex.
