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MILAN – Coffee futures markets started the year on the upswing. During the first trading session of 2026, the real’s recovery against the dollar pushed the ICE Arabica’s benchmark up by 855 points to close at 357.30 cents on Friday, 2 January. March ICE Robusta coffee recorded its seventh consecutive session in the black, with marginal gains, to settle at $3,954, up $5.
The turn of the year – although, in fact, the coffee year runs from 1 October to 30 September – is a time for taking stock and also for checking and comparing initial estimates and assessments with final figures.
Calendar year 2025 saw coffee prices reach unprecedented levels in nominal terms
New York hit its all-time high on 13 February, with the main contract at 425.10 cents. London reached record-high prices the day before (12 February), with the benchmark at $5,821.
Looking at the ICO indicators, the monthly average of the ICO Composite Indicator Price (I-CIP) fell sharply in December to 304.43 cents per lb, down 7.9% from November (330.44 cents), but 1.6% higher than the December 2024 average (299.61 cents). The peak was reached in February, when the average hit a new nominal all-time high of 354.32 cents: 94.6% higher than in February 2024.
It should be borne in mind that the coffee market is, by definition, uncertain and unpredictable, and that the figures on production and consumption released by various sources are not always consistent, partly due to the diversity of the metrics used.
It is nevertheless interesting to see how the market sentiment has changed over the course of the year and to what extent analysts’ forecasts have ultimately come true.
Let’s start with a survey conducted by Reuters in mid-February, in which 12 industry experts were interviewed about the possible evolution of the market. The respondents’ opinions revealed expectations of a significant drop in prices.
The median estimate was that ICE Arabica would close in 2025 at 295 cents, and ICE Robusta at 4,200 dollars.
As already seen, New York has ended the year more than 50 cents above this price, while London has settled below $4,000.
Meanwhile, Ilya Byzov, Head of Research & Quant Trading at Sucafina North America, painted a picture still characterised by significant volatility. He pointed to three main bullish factors: a lack of liquidity, roasters being under covered, and commodities seeing renewed interest due to the risk of trade wars.
Since early 2025, there have been signs of a return to a production surplus, albeit reduced, for the current year
As early as March 2025, Marex Spectron forecast global production at 170.7 million bags, compared to consumption of 170.5 million. A larger surplus (1.2 million bags) is expected in 2025/26, primarily thanks to the recovery in production in Vietnam.
Speaking at the annual convention of the National Coffee Association (NCA), André Acosta, director of Marex Commodity Solutions Latam, predicted a partial liquidation of long positions held in the markets over the following quarters, which did indeed happen, although this trend reversed from the end of the summer.
The markets remained in the grip of uncertainty due to the complex international geopolitical situation, the White House’s unpredictable moves on tariffs and, above all, low stock levels – the main underlying reason for the continuing bullish sentiment.
Meanwhile retail prices continued to rise. In March, a Bloomberg analysis pointed the finger at US roasters for betting on a price drop in 2024 that did not materialise. The result was a flurry of further price increases.
At the end of March, Reuters predicted that prices for Lavazza, illy, Nestlé and JDE Peet’s would increase by up to 25%.
Meanwhile, friction between roasters and large-scale retailers caused supply problems in some European countries, with various brands and products disappearing from shelves.
At the beginning of May, analysts started speculating about a new rally for Arabica coffee, with prices in New York reaching $5. Fortunately, this prediction did not come true.
As summer began, the trend in the coffee market became decidedly bearish, with the main New York contract falling below the $3 threshold at the start of July and reaching an annual low of 277.55 cents in the first session of August
London, on the other hand, hit an annual low of $3,187 on 21 July.
However, the trend reversed in the following weeks, partly due to the downward revision of Brazilian harvest estimates.
The drought in Brazil and the typhoon season in Vietnam – combined with ongoing tensions over US tariffs and the imminent implementation of the Eudr – caused prices to rise sharply in November. New York soared to 422.70 cents on 11 November, while London peaked at $4,693 on 2 November.
Improved production prospects, the lifting of US tariffs on coffee, and a new postponement of the European Union Deforestation Regulation (along with a commitment to further simplification) led to a decline in coffee market prices towards the end of the year.
The latest estimates for the coffee markets in 2025
At the beginning of December, Conab increased its official production estimates for Brazil for the 2025/26 season, while Rabobank published new data indicating a surplus of 152,000 bags for the 2024/25 season.
In 2025/26, the surplus will grow to 1.55 million bags, while for 2026/27 a large production surplus of 8.64 million is expected, supported by a recovery in production in Brazil. This trend will push Arabica prices down by about a third in the last quarter of 2026.
Analysts at the Dutch bank made a fundamental observation: “Agriculture is no longer playing by supply-and-demand rules, it’s also playing by geopolitical ones,” Rabobank head of agri commodity markets research Carlos Mera said.
