The so-called “weather market” has once again brought volatility to coffee prices on the world market. The weather in Brazil is on the radar, although concerns about the lack of rain in Vietnam have also influenced the fluctuations in commodities exchanges. After a few weeks without rain and with very high temperatures, moisture has returned to coffee-producing areas of Brazil, initially irregularly, but with a forecast of intensification over the next few days.
The forecast of more abundant rains in all regions of Minas Gerais reduced water stress and encouraged the dismantling of climate protections. In the fall, the market moved away from the 400-cent line, and the May/25 position moved back to less than 380 cents per pound in New York.
The lack of rain in Vietnam also contributed to climate volatility. Rains began to appear on the maps, favoring the corrective movement of both robusta at the London terminal and influencing the decline in New York. The market is expected to remain volatile for a while longer, with the turmoil gaining intensity due to the low physical coffee availability.
Rain in Brazil and confirmation of climate neutrality
Rain should not only intensify but also spread to coffee-growing areas in Brazil, more broadly covering the states of Minas Gerais, Espírito Santo, and Bahia. In the Cerrado region, Matas de Minas, and southern Espírito Santo, accumulated volumes by the end of the week could exceed 120 mm. This picture is expected to continue next week. Rain is likely to continue regularly in the state of Rondônia, while moisture should decrease, especially in Paraná, the state of São Paulo, and part of the extreme south of Minas Gerais.
This rain should bring relief, reducing climate tension. However, maps indicate a new reduction in rainfall for the second half of April and early May. This alternation between rainy and dry periods may still bring some volatility to coffee prices. However, the main point of concern is the effect of above-normal heat on plants. The maps show that temperatures tend to become milder at the end of April and, especially, from May onward. The cold season in Brazil and the risk of frost are on the radar.
The National Oceanic and Atmospheric Administration (NOAA) predicts a 75% chance of neutral conditions for the El Niño-Southern Oscillation (ENSO) pattern between February and April. These conditions should prevail until August. From September, the chances of La Niña increase, with projections indicating a tie between neutral and La Niña conditions in the last quarter of 2025. This means a winter in Brazil within its normal pattern, with reduced rainfall and lower temperatures.
