Coffee Market 2025: Tight Supply, Tariff Shocks, and Bullish Price Trends

The global coffee market in 2025 stands at a historic crossroads, shaped by unprecedented price spikes, export disruptions, and shifting trade patterns. Brazil, the world’s largest coffee exporter, has seen a sharp 17.5% drop in August shipments, primarily due to newly imposed 50% U.S. tariffs and weather-driven crop setbacks. At the same time, export revenues soared—up 12.7% year-on-year—as tight global supply collided with relentless demand. Arabica prices on the New York ICE have surged nearly 30% since the tariff announcement, intensifying market volatility and sparking concerns over retail prices, especially in the U.S., now displaced as Brazil’s top buyer by Germany. Similar patterns of low volume but high-value trade are seen in Vietnam, where coffee exports have fallen but values have skyrocketed. Premium and specialty coffee shipments remain robust, indicating resilient high-end demand. Weather, macroeconomic signals, and speculative positioning all conspire to keep the outlook firm to bullish. This report blends the latest price tables, a thorough analysis of supply and demand, fundamentals, weather impacts across Brazil and Vietnam, and concludes with actionable trading advice and a 3-day price forecast for key exchanges.

📈 Prices

Exchange/Product	Latest Price	Weekly Change	Market Sentiment
New York ICE (Arabica, July 2025)	8,560 USD/ton	+2.7%	Bullish
London ICE (Robusta, July 2025)	5,291 USD/ton	+3.2%	Bullish
Vietnam (Robusta Spot, Central Highlands)	130,000 VND/kg (~5,100 USD/ton)	+4.1%	Very Bullish
ICO Composite	335.76 US¢/lb	-3.5%	Neutral/Bearish

🌍 Supply & Demand

• Brazil: August 2025 exports fell 17.5% YoY, but revenue up 12.7%; YTD exports (Jan-Aug): 25.32 million bags (-20.9%), but record value (9.67 billion USD) due to high prices and weak real.
• U.S. imports from Brazil in August dropped 46%, pushing Germany to the top buyer spot.
• Premium/specialty segment strong: 5.1 million bags exported (Jan-Aug), 54.2% YoY revenue growth. U.S. leads in premium imports.
• Vietnam (Jan-Apr): exports down 10% at 663,000 tons, value +51% at 3.8bn USD. Average price nearly $5,700/ton, +67.5% YoY.
• Global inventories tight, certified robusta stocks at multi-year lows.

📊 Fundamentals

Country	2024/25 Output (000 tons)	2024/25 Exports (000 tons)	Ending Stocks (000 tons)
Brazil	3,780	2,950	1,050
Vietnam	1,650	1,350	200
Colombia	820	700	90
Indonesia	670	450	60

📝 Key Market Drivers

• High U.S. tariffs on Brazilian coffee (50%) are redrawing trade flows; Germany now leads imports from Brazil.
• USDA forecasts: Brazil’s crop down due to weather in 2024, Vietnam’s exports down but values surge—a global tight supply theme.
• Speculative funds net long on both ICE Arabica and Robusta futures; recent macro headwind from stronger USD.
• Global stocks in major exchanges remain low, supporting price upside risk.

⛅ Weather Outlook

• Brazil: Harvest conditions mostly favorable in Minas Gerais and Espirito Santo, though some pockets face late dryness possibly impacting the tail end of the crop. Logistical delays remain a risk for shipping flows.
• Vietnam: Central Highlands is experiencing below-average rainfall, stressing the 2025/26 crop’s bean set and raising drought risk through June. This poses a downside risk for Robusta output.
• Indonesia: End of wet season, dry risk rising in Sumatra, could trim robusta yields.
• Colombia: Normal rainfall, but El Niño still a threat through late 2025 for future crops.

🌎 Global Production & Stock Comparison

Country	2024/25 Output (mn bags)	2024/25 Exports (mn bags)	Key Trend
Brazil	63	49	Exports down sharply, stock drawdown ongoing
Vietnam	29	25	Lower harvest, less export but much higher prices
Colombia	14	12	Steady
Indonesia	11	7.5	Mixed, weather-sensitive

📌 Trading Outlook & Strategic Insights

• 📈 Producers: Take advantage of record prices—consider forward sales or hedge portions of 2025/26 crop.
• ⚠️ Buyers: Secure allocations early; focus on origin diversification where possible and build buffer stocks.
• 💹 Traders: Monitor U.S. and EU trade/tariff news closely; market is highly reactive to short-term shocks. Watch speculative fund positioning and macroeconomic cues (e.g., USD moves).
• 🌦️ Watch Brazil’s tail harvest, Vietnam’s rainfall—both are key for summer price action.

📆 3-Day Regional Price Forecast

Exchange/Product	Current Price (USD/ton)	3-Day Forecast (USD/ton)	Sentiment
New York ICE (Arabica)	8,560	8,550 – 8,700	Bullish/Volatile
London ICE (Robusta)	5,291	5,250 – 5,400	Bullish
Vietnam Spot	5,100	5,000 – 5,200	Firm