Robusta Coffee Futures Rally as Vietnam Grapples With Seasonal Rainfall

Robusta coffee futures are riding a strong uptrend today, with ICE robusta coffee for January delivery surging +107 points to close +2.37% higher. Meanwhile, March arabica contracts are climbing +0.57% on the session. The dual-contract strength reflects a complex interplay of weather disruptions, supply constraints, and evolving trade policy dynamics shaping the global coffee market.

Weather Disruptions Tightening Near-Term Supply

Vietnam’s coffee harvest is facing significant headwinds as heavy rainfall sweeps through Dak Lak, the nation’s premier coffee-producing province. Meteorologists are forecasting additional precipitation that poses a genuine risk to crop viability during this critical harvest window. These weather developments are proving decidedly bullish for robusta coffee futures, given Vietnam’s dominant position as the world’s largest robusta producer.

The weather story extends to Brazil as well. Climatempo projections point to heavy showers expected late this week into the following week across Brazil’s coffee-growing heartland. While this rainfall should ultimately benefit crop development in the medium term, near-term harvest operations face delays. Early this week, coffee prices had already rallied on the back of Brazilian tariff concerns, though Wednesday’s rain forecasts prompted a temporary pullback as investors reassessed the bearish supply implications.

Tariffs and Import Constraints Reshaping the Market

The Trump administration’s trade policies continue to exert outsized influence on coffee valuations. While the recent announcement eliminating tariffs on certain US-ungrown commodities provided momentary relief, the 40% emergency tariff on Brazilian coffee imports remains in full effect. Brazil’s vice president confirmed that exporters still face this substantial levy, and clarity on whether US importers qualify for exemptions has yet to materialize.

The tariff regime’s real-world impact is starkly visible in trade flows. US purchases of Brazilian coffee from August through October—the period when Trump’s tariffs took effect—collapsed by 52% year-over-year, falling to just 983,970 bags. This sharp demand destruction reflects American buyers actively avoiding new Brazilian coffee contracts, thereby tightening domestic unroasted coffee supplies. Roughly a third of America’s unroasted coffee typically originates from Brazil, making these trade frictions particularly consequential.

Inventory Tightness Fueling Price Support

ICE coffee inventories are trending toward multi-month lows, amplifying bullish sentiment. Arabica inventories hit a 1.75-year low of 396,513 bags on Tuesday, while robusta stockpiles fell to a 4-month low of 5,640 lots today. This inventory compression stems directly from the tariff-induced import slowdown, creating a self-reinforcing cycle where higher prices and reduced availability feed each other.

The International Coffee Organization reported in early November that global coffee exports for the current marketing year (Oct-Sep) edged down 0.3% year-over-year to 138.658 million bags, signaling tightness in the international supply chain and lending additional support to robusta coffee futures valuations.

Production Forecasts Paint Mixed Picture

Brazilian output expectations remain a key variable. Conab, Brazil’s official crop forecasting agency, trimmed its 2025 arabica estimate by 4.9% to 35.2 million bags in September, a reduction from the prior May projection of 37.0 million bags. Total Brazilian coffee production was cut 0.9% to 55.2 million bags for the year.

However, looking ahead to 2025/26, the USDA’s Foreign Agriculture Service projects Brazil will boost production by 0.5% to 65 million bags, with global output climbing 2.5% to a record 178.68 million bags. Robusta production specifically is forecast to jump 7.9% to 81.658 million bags globally, while arabica declines 1.7% to 97.022 million bags.

Vietnam’s coffee output is projected to surge. The Vietnam National Statistics Office reported that Jan-Oct 2025 exports climbed 13.4% year-over-year to 1.31 million metric tons. The 2025/26 crop is expected to rise 6% year-over-year to 1.76 million metric tons—a 4-year high of 29.4 million bags. The Vietnam Coffee and Cocoa Association indicated output could run 10% above the prior crop if weather cooperates, further emphasizing Vietnam’s rising clout in global robusta coffee futures markets.

StoneX’s outlook for Brazil is notably more constructive, forecasting 70.7 million bags of total coffee production in 2026/27, including 47.2 million bags of arabica—a 29% year-over-year increase that would mark substantial growth.

Bottom Line

The convergence of harvest weather disruptions in two of the world’s largest coffee regions, combined with tariff-driven import weakness and historically tight inventories, is providing robust support to robusta coffee futures. While longer-term production forecasts suggest eventual supply normalization, near-term price momentum appears firmly bullish. Traders should monitor Vietnam rainfall forecasts and Brazilian tariff policy clarity as key variables that could shift the robusta coffee futures trajectory.