Slack Rain and Frost Threats in Brazil Push Coffee Prices Sharply Higher
September arabica coffee (KCU25) Monday closed up +11.50 (+3.65%), and July ICE robusta coffee (RMN25) closed up +99 (+2.55%).
Coffee prices recovered from early losses Monday and rallied sharply. Short covering emerged in coffee futures Monday due to below-normal rainfall in Brazil, following a report by Somar Meteorologia that Brazil's largest arabica coffee-growing area, Minas Gerais, received no rain during the week ended June 21.
Coffee Prices Rebound on Slack Rain in Brazil
Cocoa Prices Surge as Ivory Coast Cocoa Exports Slow
Sugar Prices Pressured by the Outlook for Adequate Supplies
Markets move fast. Keep up by reading our FREE midday Barchart Brief newsletter for exclusive charts, analysis, and headlines.
Gains in coffee prices accelerated Monday due to the risk of frost in Brazil. Meteorologist Rural Clima said that below-normal temperatures and threats of frost are possible in Brazil over the next 72 hours, which could affect the coffee-growing regions of São Paulo and Minas Gerais.
Coffee prices have been under pressure over the past seven weeks, with arabica coffee falling to a 5-1/4 month low last Wednesday and robusta sliding to a 13-month low today due to concerns about higher coffee production and ample supplies.
Brazil's ongoing coffee harvest is weighing on prices as Safras & Mercado recently reported that Brazil's 2025/26 coffee harvest was 35% complete as of June 11, slightly behind last year's comparable level of 37% but in line with the 5-year average of 35%. The breakdown showed that 49% of the robusta harvest and 26% of the arabica harvest were complete as of June 11. Brazil's arabica harvest has been slowed by heavy rain in some areas.
Meanwhile, Brazil's Cooxupe coffee co-op announced last Wednesday that its members reported the coffee harvest was 17.8% complete as of June 13. Cooxupe is Brazil's largest coffee cooperative and Brazil's largest exporter of coffee.
On May 19, the USDA's Foreign Agricultural Service (FAS) forecast that Brazil's 2025/26 coffee production will increase by 0.5% year-over-year (y/y) to 65 million bags and that Vietnam's 2025/26 coffee output will rise by 6.9% y/y to 31 million bags. Brazil is the world's largest producer of arabica coffee, and Vietnam is the world's largest producer of robusta coffee.
Robusta coffee prices have underlying support as ICE-monitored robusta coffee inventories fell to a 1-month low Monday of 5,137 lots. In a bearish factor for arabica prices, however, ICE-monitored arabica coffee inventories rose to a 4-1/2 month high of 892,468 bags on May 27 and were modestly below that high at 865,898 bags as of Monday.
Smaller coffee exports from Brazil are bullish for prices. Last Wednesday, Cecafe reported that Brazil's May green coffee exports fell by -36% y/y to 2.8 million bags.
Due to drought, Vietnam's coffee production in the 2023/24 crop year decreased by 20% to 1.472 MMT, the smallest crop in four years. Also, Vietnam's General Statistics Office reported that 2024 Vietnam coffee exports fell -17.1% y/y to 1.35 MMT. Last Tuesday, Vietnam's National Statistics Office reported that Vietnam's 2025 Vietnam's Jan-May coffee exports are down -1.8% y/y to 813,000 MT. In addition, the Vietnam Coffee and Cocoa Association on March 12 cut its 2024/25 Vietnam coffee production estimate to 26.5 million bags from a December estimate of 28 million bags. Conversely, the USDA's FAS on May 19 projected that Vietnam's 2025/26 robusta coffee crop would climb +7% y/y to a 4-year high of 30 million bags.
The USDA's biannual report on December 18 was mixed for coffee prices. The USDA's Foreign Agriculture Service (FAS) projected that world coffee production in 2024/25 will increase +4.0% y/y to 174.855 million bags, with a +1.5% increase in arabica production to 97.845 million bags and a +7.5% increase in robusta production to 77.01 million bags. The USDA's FAS forecasts that 2024/25 ending stocks will fall by -6.6% to a 25-year low of 20.867 million bags from 22.347 million bags in 2023/24.
For the 2025/26 marketing year, Volcafe projects a global 2025/26 arabica coffee deficit of -8.5 million bags, wider than the -5.5 million bag deficit for 2024/25 and the fifth consecutive year of deficits.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
10 hours ago
- Yahoo
Amazon Just Launched More Satellites. Does That Make AMZN Stock a Buy Here?
Satellite internet plays have drawn investor interest as demand for global connectivity grows. While Elon Musk's Starlink has taken the early lead with thousands of satellites already in orbit, Amazon (AMZN) is steadily building momentum with its own Project Kuiper. On June 23, Amazon launched its second batch of 27 Kuiper satellites aboard a United Launch Alliance Atlas V rocket, bringing its constellation to 54 satellites in low Earth orbit. With plans to deploy over 3,200 satellites and a looming FCC deadline to launch half by mid-2026, Amazon is accelerating efforts to compete head-on with Starlink. Super Micro Computer Just Struck a Deal with Ericsson. Should You Buy SMCI Stock Here? CEO Jensen Huang Just Sold Nvidia Stock. Should You? Broadcom Just Got a New Street-High Price Target. Should You Buy AVGO Stock Here? Stop Missing Market Moves: Get the FREE Barchart Brief – your midday dose of stock movers, trending sectors, and actionable trade ideas, delivered right to your inbox. Sign Up Now! For investors weighing AMZN stock, this latest milestone underscores both promise and risk. Project Kuiper could unlock new revenue streams over time, but it demands vast capital and execution precision. Based in Seattle, Amazon is a global e-commerce and cloud computing leader. Beyond core operations, it invests heavily in AI and robotics, powering AWS machine-learning services and warehouse automation. Subsidiaries and startups like Zoox highlight Amazon's aggressive push into autonomous and advanced technologies. Backed by vast R&D resources, the company drives innovation across cloud, logistics, and emerging tech, keeping itself at the forefront of digital transformation. With a market capitalization of nearly $2.3 trillion, Amazon has seen its shares slide roughly 3% year-to-date. From a valuation perspective, Amazon trades at 34 times forward earnings and 3.5 times forward sales, higher than the sector medians of 16.6 times and 0.85 times, respectively, indicating that investors are pricing in its superior growth prospects and market dominance. Amazon is expanding its reach into satellite technology, following the successful launch of more Kuiper satellites, deployed by its own robotic systems, to enhance global connectivity. The company leverages artificial intelligence through AWS to process vast amounts of data from both its warehouses and satellite infrastructure. It also designs custom AI chips to accelerate machine learning tasks across its ecosystem, benefiting both internal operations and external partners. Moreover, Amazon operates hundreds of thousands of robots, including Sequoia, Hercules, Titan, Vulcan, Sparrow, Robin, Cardinal, and Proteus, to optimize package sorting and movement across fulfillment centers. With Kuiper's satellite internet, Amazon aims to connect remote warehouses and enable drone and robotaxi operations in areas lacking reliable ground networks. This is critical for technologies like Zoox, Amazon's autonomous vehicle unit, which depends on low-latency, real-time data transmission. By integrating satellite connectivity with AI, robotics, and cloud computing, Amazon is not only reducing operational costs and improving logistics efficiency, but also tapping into new revenue streams in connectivity and edge computing. On May 1, Amazon reported its Q1 2025 earnings, surpassing expectations on both the top and bottom lines. Net revenue rose 9% year over year to $155.7 billion, slightly ahead of the $155.04 billion consensus estimate. Growth was led by Amazon's high-margin advertising segment, which surged 18% to $13.92 billion. AWS revenue grew 17% year over year to $29.3 billion, slightly below Street forecasts, but the continued expansion reinforced Amazon's strong footing in the cloud services market. On the profitability front, net income climbed to $17.13 billion, or $1.59 per share, up from $10.43 billion, or $0.98 per share, in the prior-year period. That marked a 64% year-over-year increase in net profit and a 62% gain in adjusted EPS. Despite the strong quarter, Amazon issued cautious Q2 guidance. The company projected revenue between $159 billion and $164 billion, reflecting 7% to 11% year-over-year growth. Operating income is expected to range from $13 billion to $17.5 billion, below analysts' consensus of $17.8 billion. Wall Street analysts remain highly bullish on Amazon, with a consensus rating of 'Strong Buy.' Of the 53 analysts covering the stock, 45 rate it a 'Strong Buy,' six assign a 'Moderate Buy,' and only two recommend holding. Notably, there are no 'Sell' ratings on the stock, which indicates broad confidence in Amazon's long-term prospects. The average price target stands at $242.87, suggesting more than 13% upside from current levels. On the date of publication, Nauman Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
Time Magazine
10 hours ago
- Time Magazine
Trump Promotes 'Big Beautiful Bill' Hours After Big Setback
President Donald Trump stepped up his sales pitch for his 'one big beautiful bill' on Thursday, hosting an event at the White House dedicated to the sweeping legislation hours after it hit a major setback in the Senate. Despite standing in the East Room in front of dozens of Americans he said would benefit from the measure's tax cuts, Trump spent much of the time talking about the additional funding for border security in the bill. At one point, he brought his border security czar Tom Homan onto the stage to give an impassioned plea to Congress to pass the bill so that the Administration could hire 10,000 more deportation officers and 5,000 more Border Patrol agents and expand operations to deport more than 1 million people per year. 'What the hell is the matter with everybody up in Congress,' Homan said. 'Pass the bill, so we make this country safe, so we can stop the violence against ICE officers.' Hours earlier, the Senate parliamentarian ruled that several cost-cutting provisions in the bill violated Senate procedures, including a measure aimed at cutting $250 billion in Medicaid costs by cracking down on a state provider tax. The parliamentarian's ruling has forced Senate Republicans to reshape the bill and threatens to derail Trump's plan to sign it on July 4. The bill is the centerpiece of Trump's domestic agenda. At Thursday's event, he highlighted the extension of tax cuts passed during Trump's first term, vouchers for parents who want to home school their children or send them to private religious schools, a tax deduction on tips and farm equipment, and a lifting of estate taxes on family farms. Republicans hold narrow majorities in both the House and Senate and have faced pushback from members over the legislation, much of it over predictions that the measure would add trillions to the national debt. But some Republicans have expressed concern that the bill's changes to Medicaid would force millions from the program leaving them without health insurance. At one point, Trump claimed otherwise, saying, "We're cutting $1.7 trillion in this bill. And you're not going to feel any of it. And your Medicaid is left alone. It's left the same.' On border security, Trump said the bill's additional funds would triple the number of Immigration and Customs Enforcement officers and 'dramatically increase deportations to a bare minimum of 1 million illegal aliens per year.' ICE agents are 'tough,' Trump said, and he described the cities and towns inside the U.S. where ICE has stepped up its arrests of immigrants in the country illegally as 'war zones.' As he did during his campaign, he claimed that immigrants have left 'insane asylums' to come to the U.S. and conjured up the threat of the fictional serial killer Hannibal Lecter. 'They don't want to have Hannibal in our midst.' After Homan expressed frustration that the bill wasn't sailing through Congress and returned to his front row seat, Trump looked over at Homan and smiled. 'He got so angry he didn't shake my hand and look at me,' Trump said. Homan walked back up and shook Trump's hand. At the end of the event, Trump met with people in the audience. As he walked out, a reporter asked if Congress will be able to pass the bill by his July 4 deadline. 'We hope so,' he said.
CNBC
17 hours ago
- CNBC
Police detain six outside Palantir office at protest over deportations, military work
Six people were taken into custody by police on Thursday as a group blocked the entrance to the New York office of Palantir to protest the tech company's work for the U.S. Immigration and Customs Enforcement agency, the Israeli military and other efforts. More than 30 people participated in the protest, according to Planet Over Profit, the group that organized the demonstration in the Chelsea section of Manhattan. The New York Police Department had no immediate comment when asked if the six detained protestors were charged. Planet Over Profit said that all six were released later in the morning. Planet Over Profit, in a statement, said it objected to Palantir's "turbocharging ICE deportations, complicity in the genocide of Palestinians and plans to massively expand surveillance of every U.S. resident." "Palantir's tech programs are being used to deport our neighbors, kill civilians in Gaza, enhance oil extraction, and deny health insurance claims," the group told CNBC. "If your company kills for profit, we will disrupt you," a spokesperson added. Palantir did not immediately return a request for comment. Palantir was co-founded by billionaire Peter Thiel and its current CEO Alex Karp, who donated $1 million to President Donald Trump's inauguration fund. The firm has garnered attention for its defense and software contracts with the government. In April, ICE paid the company $30 million to provide the agency with "visibility" on people self-deporting, according to federal documents. Karp told CNBC in March 2024 that some Palantir employees had left the company because of his public support for Israel, and that he expected more would leave for the same reason. During an earnings call a month earlier, Karp said that he was "exceedingly proud" that Palantir was "on the ground" in Israel on the heels of the Oct. 7, 2023, attacks by Hamas. He also said that Palantir was "involved in operationally crucial operations in Israel." Shares of the company have rallied 500% over the past year and hit a new high for the year-to-date on Wednesday morning.
