
Daily Coffee Report 7/28/26
Daily coffee report

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By: Alexis Rubinstein, Managing Editor - Coffee Network

CoffeeNetwork (New York) - Brazil's coffee harvest is finally gaining momentum after weeks of weather-related interruptions, but as combines and pickers move deeper into the 2026 crop, a new concern is beginning to emerge across parts of the country's key arabica regions: bean size.
The development comes at a time when global market participants are increasingly focused on Brazil's harvest progress. The country is expected to produce one of its largest coffee crops on record in 2026/27, with the U.S. Department of Agriculture forecasting output at 71.9 million 60-kilogram bags, up 14% from the previous season. The prospect of such a large crop has been a major driver behind the decline in coffee futures over recent months and has reinforced expectations that the global market may move from a deficit into a surplus position.
Yet while volume expectations remain strong, conversations across producing regions suggest that quality and bean size could become a more important issue as harvesting advances.
According to researchers at CEPEA, harvest activity accelerated considerably during June following earlier delays caused by frequent rainfall and uneven cherry maturation. Dry weather conditions have improved field access and allowed producers to expand harvesting efforts across major producing regions. In the Matas de Minas region, harvest progress has reached an estimated 20% to 30% of the crop, while producers in South Minas Gerais report completion rates between 15% and 25%. In São Paulo's Mogiana region, harvesting is estimated between 10% and 20% complete.
However, CEPEA reports that many producers are expressing concerns about screen size, particularly in South Minas and Mogiana Paulista. Early observations indicate that a larger proportion of beans may fall into smaller screen categories compared with last year's crop. Researchers caution that it is still too early to draw definitive conclusions because harvest activities remain in the early stages, but the issue is increasingly being discussed within commercial circles.
For exporters and roasters, bean size matters because larger screen coffees generally command premiums in export markets. Larger beans also tend to deliver more uniform roasting characteristics and are often preferred by specialty buyers and premium blends. A crop that delivers strong overall volume but a lower share of larger screen beans could lead to more complex pricing dynamics than headline production figures might suggest.
The concern reflects the unusual weather conditions that shaped crop development over the past year. Although rainfall was sufficient to support flowering and fruit development across most producing regions, precipitation patterns were irregular in late 2025 before becoming more consistent in early 2026. Overall crop prospects remain favorable, but uneven maturation and varying fruit development rates have been observed in some areas.
Market participants note that bean size issues do not necessarily imply lower production. In fact, both conditions can exist simultaneously. Brazil may still harvest a record or near-record crop while producing a greater share of smaller beans. Such an outcome would have important implications for export composition, grading distributions, and pricing differentials throughout the marketing year.
The timing is particularly noteworthy because the market is already attempting to reconcile two competing narratives. On one hand, virtually every major forecasting organization expects significantly improved coffee supplies during 2026/27. USDA estimates Brazil's crop at 71.9 million bags, while several private analysts have projected even larger harvests. These forecasts have contributed to a more bearish long-term supply outlook and have encouraged expectations of a sizable global arabica surplus.
On the other hand, nearby physical indicators remain considerably tighter than broader production forecasts suggest. ICE-certified arabica inventories recently fell below 400,000 bags, reaching their lowest levels in more than two years. The persistence of tight certified stocks indicates that physical coffee availability in many consuming markets remains constrained despite expectations for larger future supplies.
Bean size concerns could become another factor complicating that picture. If a larger crop produces fewer premium-sized beans, roasters seeking specific quality characteristics may continue facing tighter availability than overall production numbers imply. That scenario would not necessarily alter the broader supply outlook, but it could affect quality differentials and purchasing strategies across the supply chain.
For now, the industry remains in a data-gathering phase. Harvesting is still relatively early in most arabica regions, and a more reliable assessment of bean size distribution will emerge as larger portions of the crop are processed and graded. What is clear is that the conversation in Brazil is beginning to shift beyond simple production totals.
After months dominated by discussions of crop size and surplus forecasts, attention is increasingly turning to the composition of the harvest itself. In a market that remains highly sensitive to both quality and availability, the size of Brazil's beans may prove nearly as important as the size of its crop.
Alexis Rubinstein
Source: StoneX, USDA, CEPEA
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Daily coffee report


July 28 – Stock futures were mixed to firmer overnight, as relative calm continues in the Middle East and as the Federal Open Market Committee begins two days of monetary policy discussion. The VIX is trading near 19, while the dollar index trades near 101.5. Yields on 10-year Treasuries are trading near 4.63%, while yields on 2-year Treasuries are trading near 4.30%. WTI crude oil is trading near $81 per barrel after actually probing below $80 earlier in the session, while Brent trades near $87 per barrel. The grain and oilseed sector tried to bounce in the overnight session following yesterday’s active selloff, but it quickly succumbed to additional selling pressure as crude oil added to its losses, with the exception of corn that held modest gains based on tumbling crop ratings.


Daily coffee report

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