Coffee futures tumbled on Monday, pressured by a stronger U.S. dollar and rising global production estimates. July arabica coffee (KCN25) dropped 3.82%, closing down 14.80 points, while July robusta coffee (RMN25) fell 3.33%, or 174 points.
The selloff pushed arabica to a 2-1/2 week low and robusta to its lowest level in a month. A key factor was the U.S. dollar index hitting a one-month high, which makes commodities like coffee more expensive for foreign buyers and tends to weigh on prices.
Fresh forecasts also pointed to larger coffee supplies in the coming year. On Friday, the U.S. Department of Agriculture (USDA) predicted that Honduras, Central America’s largest coffee producer, would see a 5.1% increase in 2025/26 production, reaching 5.8 million bags.
Meanwhile, Brazil, the world’s top coffee producer, is also expected to boost output. Consulting firm Safras & Mercado raised its 2025/26 forecast to 65.51 million bags, up from 62.45 million. Additionally, Conab, Brazil’s crop forecasting agency, lifted its 2025 estimate to 55.7 million bags, compared to 51.81 million projected in January.
These supply gains are adding bearish pressure to the coffee market, already reeling from currency movements and broader commodity trends.
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