Daily Coffee Report 11/10/26
Daily coffee report
StoneX Coffee Team
- Coffee
Futures Rebound as Traders Balance Record Brazilian Supply Against Tight Market Structure
Alexis Rubinstein
Managing Editor - Coffee Network
CoffeeNetwork (New York) - Coffee futures moved higher on Wednesday, with both Arabica and Robusta contracts posting gains as traders weighed improving supply prospects against persistently tight certified inventories and historically low participation in the futures market. ICE December Arabica was last seen 2.20 higher at 291.80 with 8,360 contracts at the time of writing.
London Robusta also advanced, extending a modest recovery from the recent sell-off that pushed prices to multi-week lows earlier this month.
The rally comes as the market continues to struggle with competing narratives. On one hand, Brazil is harvesting a record crop and exports are accelerating. On the other, ICE-certified stocks remain exceptionally low and open interest has fallen to levels not seen since 2014, highlighting a market with limited participation and the potential for continued volatility.
The biggest fundamental development remains the release of the third 2026 coffee survey from Conab, which raised Brazil's crop estimate to a record 67.6 million 60-kg bags, up 19.6% from the previous year. The agency estimates Arabica production at 48.2 million bags, up 34.8%, while Robusta output is forecast at 19.4 million bags, down 6.6% from last year's record harvest. Harvest progress has reached approximately 99% nationwide. The upward revision reinforces the view that global coffee supplies will improve during the 2026/27 season. However, traders appear increasingly focused on how much of that supply ultimately reaches consuming markets and whether replenishment of destination inventories will occur quickly enough to ease concerns about nearby availability.
Export data suggest Brazilian supplies are beginning to flow more aggressively. According to recent trade figures, Brazil exported approximately 3.8 million bags of coffee in August, up more than 43% from a year earlier. Industry data from Cecafé placed total August shipments above 4.1 million bags, marking the largest August export volume on record. The stronger exports reflect improving logistics and the completion of harvest activities across key producing regions. The market has therefore shifted away from concerns about harvest delays and is increasingly evaluating how quickly export flows can rebuild inventories in key importing countries.
Despite larger exports and a record Brazilian crop, physical market indicators remain unusually tight. ICE-certified Arabica stocks recently fell to approximately 224,000 bags, the lowest level since 2000. Although inventories have shown modest replenishment in recent weeks, stocks remain dramatically below historical norms and continue to provide underlying support to the market.
The disconnect between growing production and limited exchange stocks remains one of the market's most important themes. Traders continue to debate whether certified inventories can rebuild substantially during the fourth quarter or whether tight nearby supplies will persist longer than expected.
Another notable feature of today's market is the continued decline in futures participation. Open interest in the ICE Coffee C Futures market recently fell to approximately 152,136 contracts, down sharply from more than 213,000 contracts recorded in June and among the lowest levels seen since the 2013-2014 period. Typically, rising commodity prices attract additional speculative and commercial activity. Instead, coffee has experienced declining open interest despite historically elevated prices. The trend suggests many market participants remain reluctant to carry risk amid heightened volatility, elevated margin requirements, and uncertainty regarding future supply and demand balances. For the broader market, low participation may be contributing to larger day-to-day price swings. With fewer positions and thinner liquidity, relatively small buying or selling programs can have a greater impact on futures prices than would be expected in a more heavily traded market.
As the 2026 harvest wraps up, market attention is increasingly turning toward the development of Brazil's 2027 crop. Recent rainfall and flowering conditions are being closely monitored, particularly as forecasters continue to discuss potential El Niño risks. Several market analysts have noted that coffee prices are becoming less sensitive to current harvest data and more responsive to news affecting next year's production outlook. This transition is typical following a major Brazilian harvest. Once production estimates become largely known, traders begin pricing future weather risks and the country's biennial production cycle.
Wednesday's gains in both Arabica and Robusta futures underscore the uncertainty that continues to define the coffee market.
Alexis Rubinstein
- Coffee
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