September arabica espresso (KCU25) Friday closed down -1.90 (-0.62%), and September ICE robusta espresso (RMU25) closed down -4 (-0.11%).

Espresso costs settled decrease on Friday, with arabica espresso posting a 6-3/4 month low.  The outlook for plentiful espresso provides is undercutting costs.   On Wednesday, the USDA’s Overseas Agricultural Service (FAS) forecast that Brazil’s 2025/26 espresso manufacturing will enhance by 0.5% year-over-year (y/y) to 65 million luggage and that Vietnam’s 2025/26 espresso output will rise by 6.9% y/y to a 4-year excessive of 31 million luggage.  Brazil is the world’s largest producer of arabica espresso, and Vietnam is the world’s largest producer of robusta espresso.

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The advancing espresso harvest in Brazil can also be weighing on espresso costs.  On Tuesday, Brazil’s Cooxupe espresso co-op introduced that its members reported the espresso harvest was solely 24.3% full as of June 20, in contrast with 34.2% accomplished on the similar time final yr.  Cooxupe is Brazil’s largest espresso cooperative and Brazil’s largest exporter of espresso.  Additionally, Safras & Mercado lately reported that Brazil’s 2025/26 espresso harvest was 35% full as of June 11, barely behind final yr’s comparable stage of 37% however in step with the 5-year common of 35%.  The breakdown confirmed that 49% of the robusta harvest and 26% of the arabica harvest had been full as of June 11.  Brazil’s arabica harvest has been slowed by heavy rain in some areas.

Espresso costs have additionally been pressured this week after the danger of frost was faraway from climate forecasts in Brazil’s coffee-growing areas, together with São Paulo and Minas Gerais.

Beneath-normal rainfall in Brazil is supportive for espresso costs.  On Monday, Somar Meteorologia reported that Brazil’s largest arabica coffee-growing space, Minas Gerais, acquired no rain throughout the week ended June 21.  

Robusta espresso costs have acquired help from tightening provides after ICE-monitored robusta espresso inventories fell to a 5-week low on Thursday at 5,108 heaps.  Nonetheless, in a bearish issue for arabica costs, ICE-monitored arabica espresso inventories rose to a 4-3/4 month excessive of 892,468 luggage on Might 27 and had been modestly under that top at 844,319 luggage as of Friday.

Smaller espresso exports from Brazil are bullish for costs.  Final Wednesday, Cecafe reported that Brazil’s Might inexperienced espresso exports fell by -36% y/y to 2.8 million luggage.

Because of drought, Vietnam’s espresso manufacturing within the 2023/24 crop yr decreased by 20% to 1.472 MMT, the smallest crop in 4 years.  Additionally, Vietnam’s Basic Statistics Workplace reported that 2024 Vietnam espresso exports fell -17.1% y/y to 1.35 MMT.  Final Tuesday, Vietnam’s Nationwide Statistics Workplace reported that Vietnam’s 2025 Vietnam’s Jan-Might espresso exports are down -1.8% y/y to 813,000 MT.  As well as, the Vietnam Espresso and Cocoa Affiliation on March 12 minimize its 2024/25 Vietnam espresso manufacturing estimate to 26.5 million luggage from a December estimate of 28 million luggage.

The USDA’s biannual report, launched on Wednesday, was bearish for espresso costs.  The USDA’s Overseas Agriculture Service (FAS) projected that world espresso manufacturing in 2025/26 will enhance +2.5% y/y to a report 178.68 million luggage, with a -1.7% lower in arabica manufacturing to 97.022 million luggage and a +7.9% enhance in robusta manufacturing to 81.658 million luggage.  The USDA’s FAS forecasts that 2025/26 ending shares will climb by +4.9% to 22.819 million luggage from 21.752 million luggage in 2024/25.

For the 2025/26 advertising and marketing yr, Volcafe tasks a world 2025/26 arabica espresso deficit of -8.5 million luggage, wider than the -5.5 million bag deficit for 2024/25 and the fifth consecutive yr of deficits. 

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