The Market Update explores how this week’s news, weather and other factors are shaping the global coffee trade.
Strange times, when the coffee market follows politics as closely as the weather. Tight election results in Brazil, followed by allegations, worked to trigger a sharp market decline, with the “C” dropping nearly 20c/lb. What will happen this week?
Elections aside, what else is new? Brazil differentials continue to reflect the market’s volatility. Concerns are growing around the availability of Fine Cup offers for this harvest, and even more so for larger screen sizes, adding another layer of uncertainty.
Peru has sold out — maybe oversold, as we see some defaults or requests to amend shipments to New Crop 2027. Organic and Fairtrade Organic types appear more affected. It looks likely we will see old short positions carry over into new Peru crop next year.
Guatemala and Costa Rica, while still several away months from shipping (optimistically, Feb onward), are high priced where offered, as concerns over the both the size of harvests and pending El Nino effects remain. El Salvador and Nicaragua face the same weather anxieties.
Honduras prices remain high, if offered. While historically a November HG shipment was common, we are looking for Jan/Feb onward this year.
Likewise, washed Ethiopias appear to be in short supply, as ongoing local conflicts disrupt the country and a smaller harvest further tightens availability. Ethiopia Naturals are available but no where near the discounted prices of the past.
Spot supply remains thin, while shipping delays at the origin appear to be increasing. We also anticipate higher freight rates for 2027 shipments.
All of these factors reinforce the importance of planning and securing contracts. Accurate usage projection and forward purchasing strategies may be more critical than ever in navigating the uncertainty ahead. —N.B.
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