MILAN – For the second day in a row, the coffee futures markets posted strong gains. Yesterday, Tuesday 4th March, ICE Arabica’s main contract for May delivery returned above the psychological $4 per pound level to close at 398.40 cents, up 1,175 points (+3%) from the previous session. In London, coffee futures for May delivery gained 2.9% (+$159) to close at a one-week high of $5,645.
The lack of rainfall in Minas Gerais, Brazil’s main Arabica producing state, during the critical period for the development of the crop, continues to be a concern.
There is also negative news on the statistical front.
The Ico reported yesterday that world coffee exports totalled 10.83 million bags in January, down more than 13% from 12.49 million in the same month last year.
In the first 4 months of coffee year 2024/25, world exports fell by 4.9% to 42.79 million, compared with 45.01 million in the same period of 2023/24. In the last 12 months available (February 2024 – January 2025), world exports totalled 135.79 million bags, up from 128.04 million in the previous equivalent period.
Arabica shipments rose sharply to 85.7 million (+12.3%), while Robusta volumes fell by 3.1% to 50.09 million.
Rising coffee prices are emptying the shelves of large retailers in some European countries. This is happening in the Netherlands, where two leading supermarket chains – Albert Heijn and Jumbo – said they stopped stocking certain products from coffee giant JDE Peet’s NV as they renegotiate supply deals, reports Bloomberg.
There have also been reports of similar disruptions at German supermarket firms Edeka and Aldi Nord, as well as in Belgium, where retail group Colruyt resolved talks with Jacobs Douwe Egberts, after stopping orders over pricing issues, according to Belgian news outlet Belga, quoted by Bloomberg.
The online chain Picnic went even further, delisting all JDE Peet’s brandst. “The A-brand suppliers want to increase their profitability at the cost of the consumers,” Picnic co-founder Michiel Muller told Bloomberg.
JD Peet’s admitted that negotiations with some retail brands were taking “longer than we hoped for,” but added that it had successfully renegotiated 80 per cent of sales. The company’s CEO Rafael Oliveira stated in a call last week that “significant price increases are inevitable,” in light of soaring costs.
CEO Rafael Oliveira told a conference call last week that the current price increases were inevitable in the face of rising costs. A view shared by Cyrille Filott, global strategist at Rabobank. “Coffee will be more expensive without shadow of a doubt,” Filott said in an interview with Bloomberg. “The question is by how much.”
