Coffee Market Surges Amidst Brazil's Drought and Global Climate Conditions

The coffee futures market posted significant gains this Monday (09), primarily driven by adverse weather events that threaten global production. Arabica coffee saw substantial appreciation, with the December/24 contract rising by 3.98%, while robusta also registered notable gains, reflecting the direct impact of unfavorable weather conditions. International exchanges reacted to the uncertainty, pushing prices higher due to the potential reduction in global supply, especially considering the persistent drought affecting Brazil.

Brazil, the world's largest coffee producer, is facing its worst drought in four decades, directly impacting the productivity of crops in key regions such as South Minas Gerais and Cerrado Mineiro. Reports indicate that flowering for the 2025/26 crop has already begun in some areas, but low rainfall and below-average soil moisture increase the risks to plant development. If rains do not return in sufficient volumes in the coming weeks, coffee prices may continue to rise, finding additional support in the market.

In the domestic market, arabica type 6 also saw significant gains, with increases of up to 4.38% in some regions like Machado/MG and Franca/SP. The peeled cherry variety followed this upward trend, though on a smaller scale. These movements reflect producers' concerns about the drought’s impacts and the expectation of higher prices as supply becomes more constrained.

Source: Notícias Agrícolas