On the fundamental side, the coffee market is reacting to the recent rain and the forecast of an even moister November, with mild temperatures—a favorable condition for the development of coffee crops in Brazil. Despite the more positive climate scenario compared to last year, traders remain cautious in their initial assessments of the next Brazilian arabica crop. Doubts persist regarding the effects of frosts, uneven blossoming, and temperature fluctuations. All this caution in the projections is natural, after all, in previous years, very optimistic initial impressions ended up not being confirmed. The market awaits the results of the coffee crop tours, which should gain prominence from November onward.
The size of the 2026 Brazilian arabica crop should be the main determining factor for the price curve next year. The September/26 contract in New York maintains a negative spread of 60 cents compared to December/25 and 40 cents compared to March/26—the current reference for physical pricing by Brazilian exporters. This negative spread in futures positions reflects the expectation of a larger harvest in Brazil in 2026.
The market is also monitoring crop progress in other origins. In Vietnam, excessive rainfall may delay the harvest, while diplomatic tensions between Colombia and the United States remain on the radar. Even so, the expectation is for an increase in the global coffee supply in the coming few months, which tends to ease supply constraints and help put downward pressure on prices.
Brazilian physical market prices decline in line with the futures market
In the Brazilian physical market, good cup arabica coffee is trading around BRL 2,260 per bag, down nearly BRL 100 from the previous week. Despite the decline, coffee remains quite valuable. There is increased interest from producers, including inquiries about the new crop. Even so, producers remain cautious, slowing down sales and taking advantage of the favorable price moment without rushing.
In the short term, the key point for the market is the decision regarding Brazilian coffee tariffs. In the long term, the determining factor will be the size of the next crop in the country. Meanwhile, the increase in supply from other origins should influence the pace of the global coffee flow. Producers should keep monitoring fluctuations in the dollar and the futures, adjusting their positions and taking advantage of selling opportunities, but without exaggeration—at least for now.
