The global coffee market finds itself at a crucial juncture in mid-2025, characterized by sharp price rallies, shifting export patterns, and weather-driven supply anxieties. India, the world’s seventh-largest coffee producer, has become a microcosm of these market forces with its recent export data. Despite an 18% drop in shipment volumes for Q2, India’s coffee export earnings soared by 19% year-on-year to $616 million, propelled by a 49% surge in average unit value. This paradox—higher earnings on lower volumes—mirrors global dynamics shaped by lean output in key origins such as Brazil and Vietnam, which have seen weather events and logistical disruptions roil supplies.
The resulting spike in international coffee prices has encouraged opportunistic selling and careful, need-based buying on the import side, notably in Europe. Italy, Germany, and Belgium continue to dominate as Indian coffee buyers, reinforcing Europe’s central role in the global coffee trade. As seasonal transitions take hold in Brazil and Vietnam, market participants are watching not only for supply shocks caused by erratic weather but also for shifting demand trends among major roasters and speculators. The next quarter will likely hinge on weather developments in Latin America and Southeast Asia, policy adjustments, and speculative activity on ICE and Euronext exchanges. This comprehensive report explores the current landscape, analyzing fundamental data, price trends, and actionable outlooks for industry stakeholders.
📈 Prices & Market Snapshot
| Exchange | Product | Closing Price | Weekly Change | Market Sentiment |
|---|---|---|---|---|
| ICE US (New York) | Arabica Coffee (July 2025) | 233.40 US cents/lb | +2.5% | Bullish |
| ICE Europe (London) | Robusta Coffee (July 2025) | 4,241 USD/tonne | +1.9% | Bullish |
| Euronext (Paris) | Robusta Coffee (July 2025) | 3,978 EUR/tonne | +2.2% | Bullish |
🌍 Supply & Demand Overview
- India: Q2 coffee export value: 616 million USD (+19% YoY), volume: 103,000 tonnes (-18% YoY)
- Global: Output in Brazil and Vietnam remains constrained due to adverse weather and logistical interruptions.
- Italy leads as India’s top importer (33,823 tonnes Jan–Jun 2025), followed by Germany and Belgium.
- India exported over two-thirds of its annual 360,000 tonne production in the past year.
- Bullish sentiment prevails due to supply shortfalls and resilient global demand.
📊 Fundamentals
- Unit Value: Indian exports averaged 6,108 USD/tonne in Q2 2025 (+49% YoY).
- Major Exporters: Brazil, Vietnam, Colombia, Indonesia, Ethiopia, India.
- Major Importers: EU (Italy, Germany, Belgium), US, Japan, Russia.
- USDA Report: Cites declining carryover stocks in Brazil, offset only partly by higher Colombian and Indonesian crops.
- Speculative Positioning: Net long positions at ICE’s arabica contracts have grown, reflecting market optimism.
🌦️ Weather & Yield Outlook
- Brazil (Minas Gerais): Recent dry and unseasonably warm spells threaten flowering and bean development; below-normal rainfall is forecast through next week.
- Vietnam (Central Highlands): Sporadic rains have improved soil moisture, but excessive heat earlier in the season may pressure robusta output.
- India (Karnataka, Kerala): Southwest monsoon onset is timely; good early-season rainfall expected to boost 2025/26 output unless mid-season dry spells recur.
🌐 Global Production & Stocks Comparison
| Country | 2024 Output (thousand tonnes) | Year Change | Stock (thousand tonnes) |
|---|---|---|---|
| Brazil | 3,265 | -6% | 1,100 |
| Vietnam | 1,765 | -4% | 275 |
| Colombia | 858 | +2% | 136 |
| Indonesia | 689 | +1% | 92 |
| India | 360 | 0% | 21 |
📆 Trading Outlook & Recommendations
- Maintain long positions in Arabica; supply risks and dwindling stocks support higher prices.
- Monitor ICE certified stock trends and weather in Brazil and Vietnam for near-term price volatility.
- Importers should consider need-based buying, with a focus on locking in part of forward requirements amid high volatility.
- Watch for speculative pressures; profit-taking rallies are possible if rains return in Brazil.
- Track rupee/dollar movements for India-based exporters; favorable rates may enhance realizations.
🔮 3-Day Regional Price Forecast
| Exchange | Product | Forecasted Price Range |
|---|---|---|
| ICE US (NY) | Arabica Coffee | 229.00–236.50 US cents/lb |
| ICE Europe | Robusta Coffee | 4,170–4,280 USD/tonne |
| Euronext (Paris) | Robusta Coffee | 3,950–4,060 EUR/tonne |
