Coffee lovers might want to brace themselves—prices for their daily brew are shifting again. As of today, March 23, 2025, coffee prices are showing mixed results. May arabica coffee (KCK25) has seen ups and downs, with one report noting a drop of -4.50 (-1.15%) and another showing a slight rise of +0.30 (+0.08%). Meanwhile, May ICE robusta coffee (RMK25) is either holding steady or slipping slightly, down -21 (-0.38%). What’s driving these changes? It’s a complicated mix of weather troubles, supply shifts, and global market forces affecting the two biggest coffee producers—Brazil and Vietnam.
Brazil’s Weather Woes Push Arabica Prices Up
Brazil, the world’s top grower of arabica coffee, is facing some serious challenges. Rainfall in its key coffee region, Minas Gerais, has been disappointing. According to Somar Meteorologia, the area got just 30.8 mm of rain in the week ending March 15—only 71% of what’s normal. That’s not good news for coffee trees, especially after a year of dry weather linked to last year’s El Nino. The natural disaster monitoring center Cemaden says Brazil has been dealing with its driest conditions since 1981. This ongoing drought has hurt coffee trees during their flowering stage, which could mean fewer beans for the 2025/26 season.
Adding to the concern, Cooxupe, Brazil’s biggest arabica coffee co-op, recently pointed out that high temperatures and low rainfall in February are likely to cut this year’s yields. Conab, Brazil’s crop forecasting agency, agrees—back on January 28, it predicted the 2025/26 coffee harvest would drop by 4.4% to 51.81 million bags, the lowest in three years. They also trimmed their 2024 estimate by 1.1%, bringing it to 54.2 million bags. And it gets worse: Volcafe, a coffee trader, slashed its 2025/26 arabica forecast by a whopping 11 million bags to 34.4 million after seeing how bad the drought has been. They’re now expecting a global arabica shortage of 8.5 million bags next year, the fifth year in a row of deficits.
On the export front, Brazil’s numbers aren’t helping either. Cecafe reported that February’s green coffee exports fell 12% compared to last year, hitting just 3 million bags. Even though 2024 exports soared 28.8% to a record 50.5 million bags, according to Conab, the current trend suggests tighter supplies ahead. All this has kept arabica prices on edge, with some days showing gains as traders worry about what’s coming next.
Vietnam’s Robusta Struggles Keep Prices Firm
Over in Vietnam, the story’s a bit different but no less tricky. As the world’s leading producer of robusta coffee, Vietnam’s output matters a lot. Drought has been a big problem here too. The 2023/24 crop year saw production plunge 20% to 1.472 million metric tons, the smallest in four years, thanks to dry conditions. The USDA’s Foreign Agriculture Service (FAS) says the 2024/25 season might dip a little more, forecasting 27.9 million bags compared to 28 million the year before. The Vietnam Coffee and Cocoa Association went even further last week, cutting its 2024/25 estimate to 26.5 million bags from 28 million.
Weather isn’t letting up either. The Dak Lak weather office warned that Vietnam’s Central Highlands, the heart of its coffee country, will see more heat and less rain from March 21-31. That’s bad timing for robusta crops, which need water to thrive. Exports are down too—Vietnam shipped 17.1% less coffee in 2024, dropping to 1.35 million metric tons, according to the General Statistics Office. But there’s a twist: February exports actually jumped 6.6% to 169,000 metric tons, which has put some downward pressure on robusta prices lately.
Inventories and Global Supply Add More Layers
Stockpiles are another piece of the puzzle. For arabica, supplies are getting tight—ICE-monitored inventories hit a 3-1/2 week low of 782,648 bags on Wednesday before slipping to 782,489 by Thursday. That scarcity is helping prop up arabica prices. Robusta, on the other hand, has seen a bump in supplies. ICE inventories climbed to a 6-week high of 4,360 lots today, up from 4,336 lots midweek. More beans in storage usually means lower prices, and that’s why robusta isn’t climbing like arabica right now.
Globally, the picture’s mixed. The USDA’s December 18 report predicted a 4% rise in world coffee production for 2024/25, reaching 174.855 million bags—arabica up 1.5% to 97.845 million bags and robusta up 7.5% to 77.01 million bags. But they also expect ending stocks to drop 6.6% to 20.867 million bags, the lowest in 25 years. Brazil’s 2024/25 output is pegged at 66.4 million metric tons, down from an earlier guess of 69.9 million, with inventories expected to shrink 26% to 1.2 million bags by June. Meanwhile, Marex Solutions is calling for a 1.2 million-bag surplus in 2025/26, up from 200,000 bags this year, which could ease prices down the road.
Export trends aren’t clear-cut either. While Brazil’s 2024 numbers were huge, the International Coffee Organization (ICO) says global exports slipped—December was down 12.4% to 10.73 million bags, and October-December fell 0.8% to 32.25 million bags. That tug-of-war between big shipments and tighter supplies keeps the market guessing.
Dollar Strength and El Nino’s Lasting Echoes
Today’s stronger dollar—it hit a 2-week high—hasn’t helped coffee prices. When the dollar climbs, commodities like coffee get pricier for buyers using other currencies, which can drag prices down. That’s part of why arabica took a hit in one report. But the bigger story is still weather, especially the fallout from last year’s El Nino. In Brazil, below-average rain since April 2024 has left coffee trees struggling, and Colombia, the second-biggest arabica grower, is still recovering from its own El Nino drought. This long-term damage could mean smaller harvests for years, keeping prices jittery.
What’s Next for Coffee Prices?
So where does this leave coffee? Arabica’s getting a boost from Brazil’s drought fears and low inventories, while robusta’s feeling the weight of rising stockpiles and mixed export signals from Vietnam. The USDA sees more beans coming in 2024/25, but shrinking stocks and weather worries could outweigh that. Volcafe’s dire 2025/26 forecast—especially that 8.5 million-bag arabica deficit—suggests tighter times ahead. For now, prices are bouncing between hope and caution, with traders watching rain clouds and inventory reports like hawks.
Coffee drinkers might not see huge changes at the counter yet, but if Brazil and Vietnam can’t catch a break from the weather, that morning cup could start costing more. Keep an eye on those forecasts—it’s going to be a wild ride for coffee in 2025 and beyond.
