Coffee Rally: Vietnam's Heavy Rains Shake Robusta Markets

Robusta coffee is having a solid day, jumping +2.37% as flooding in Vietnam’s Dak Lak province throws a wrench into harvest plans. Meanwhile, arabica is up +0.57% on dollar weakness.

Here’s what’s driving the move: Vietnam, the world’s biggest robusta producer, is getting hammered by rainfall. More showers are forecast, which could damage crops. At the same time, ICE robusta inventories just hit a 4-month low at 5,640 lots—tight supplies are bullish.

On the flip side, Vietnam’s 2025/26 coffee output is projected to hit 1.76 million tons, up 6% y/y and a 4-year high if weather cooperates. That’s a lot of supply coming.

Brazil’s side is messier. The country’s facing 40% Trump tariffs, which has crushed US imports—down 52% from last year through October. But Brazil’s also getting decent rain in key growing regions (Minas Gerais got 42% of historical average rainfall), which supports crop development. Conab cut Brazil’s 2025 arabica estimate to 35.2M bags, but StoneX projects the 2026/27 crop could jump 29% y/y to 70.7M bags.

Bottom line: Near-term weather shocks are supporting prices, but massive global production increases looming could cap any rally.