The Market Update explores how this week’s news, weather and other factors are shaping the global coffee trade.
Another volatile week, as we see coffee strengthen from 290 to 305 c/lb.
Near-term demand remains huge, while supply chains are very thinly loaded or disrupted.
The weather remains a huge topic, with potential El Niño effects already impacting upcoming Centrals harvests.
As we enter an important harvest window, we should see strong supply from Colombia as its main harvest begins. Any concerns will be in regard to how long the harvest lasts and the weight of still-open shorts. Any weather events will affect the mitaca—so a good coverage of Colombias should be considered sooner rather than later.
In Honduras, it’s expected that the crop will be smaller by 10 to 30 percent. The harvest will start coming in during November, so we’re still a few weeks away from real clarity—but a smaller harvest is for certain.
Generally higher differentials and demand for washed coffee has pushed prices for Costa Rica and Guatemala higher. Like Honduras, Costa Rica has real concerns over the size of its coming crop. Guatemala will also be slightly smaller; demand is already looking strong for early shipments, and prices are reflecting that.
In East Africa, Kenya looks heavily sold, with bumper prices paid. Demand in Tanzania, ahead of the November auctions, already has starting prices in the +50’s. News from Ethiopia is incredibly sad, with internal violence and disruptions likely to get worse and issues with washed coffees looking very real.
Brazil remains a constant, but slow shipments (port related) are creating gaps in the supply chain. The crop will be big, but concerns over FC have made the delta between GC and FC profiles even more magnified in bigger screen sizes.
The market looks high and is riding news on weather and short-term stocks/availability. Spot coffee remains thin. For fear of being a broken record: Planning is key, and perhaps more than ever for 2027 forward washed coffees from Central America. —N.B.
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