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MILAN – May saw a partial downward trend in the coffee market, with the lingering bullish pressures temporarily put on hold: the ICO Composite Indicator Price (I-CIP) averaged 334.41 cents/lb, marking a marginal change of -0.4% compared to April. However, the daily indicator revealed a predominantly bearish evolution after the peaks recorded at the beginning of the month, bringing values back to levels close to the lows at the start of the year.
After reaching a high of 355 cents on 6 May, the indicator fell almost constantly for the rest of the month, reaching a low of 305.96 cents/lb on 30 May, the lowest level since 20 January.
Returning to the monthly averages, although the Arabica indicators have also taken a downward trend since the second decade, they record a positive variation compared to the previous month. In fact, Colombian Milds, Other Milds and Brazilian Naturals were up by 0.4%, 1.3% and 0.5% respectively.
The Robustas retracted 3.5% to 237.76 US cents/lb. The London Intercontinental Commodity Exchange (ICE) market was the main driver of the decline, decreasing by 4.7% and reaching 224.63 US cents/lb, whereas the New York ICE market shrank by 0.6%, averaging 368.21 US cents/lb in May 2025.
The report attributes this trend to a combination of specific events, macro-economic occurrences and geopolitical factors that has ushered in a degree of negative uncertainty within the coffee market.
“The latest movements suggest that the price of coffee is searching for direction, with both bullish and bearish factors affecting the market, although the former appears to have the upper hand,”reads the report.
Among the “bullish” factors, the report cites the improved US consumer confidence, which is bound to support consumption.
Among the “bearish” factors, Ico mentions in particular:
- the United States Department of Agriculture’s semi-annual outlook on key producing countries has forecasted an increase in supply, applying a negative pressure on the I-CIP. For Brazil, there is a forecast of a 0.2% increase for crop year 2024/25 and of an 8.0% increase for Peru for crop year 2025/26;
- the prediction of Enso-neutral conditions (neither El Niño nor La Niña) until October 2025. The El Niño phenomenon typically brings about heavy rain in South America, which would have fallen during flowering months. Heavy precipitation during these months could subsequently negatively impact output for coffee year 2025/26, therefore the preclusion of El Niño in 2025 implies a better crop outlook;
- the easing of the crisis in the Suez Canal, following the announcement of ceasefire deal between the United States and the Houthi movement in Yemen—brokered by Oman. However, traffic in the Red Sea and Suez Canal still remains at about half of pre-crisis levels, and major carriers have stated that they will not return to normal operations in the region until there has been at least three months of stability, without attacks, with broader security guarantees.;
- during the world’s second largest roaster’s Q1 earnings call, it was mentioned that JDE Peet’s was considering price increases due to persistent higher prices in 2025, thereby potentially affecting demand;
- general uncertainty around trade tariffs in the USA still remains, leading to expectations of a potential recession and therefore affecting the strength of demand.
Meanwhile, the ICO has left its estimates for world coffee production and consumption for the 2023/24 CY unchanged at 178 and 177 million bags respectively.
The London-based organisation has not yet published any forecasts for 2024/25 in its reports.
