Quarterly Commodities Outlook is available for free now. Download your report →
By: Editorial Team, StoneX Media
The coffee market is balancing two competing realities. Expectations for Brazil's largest coffee harvest on record have driven prices sharply lower, yet physical coffee inventories remain exceptionally tight across key consuming regions. That disconnect is delaying the market's transition from shortage to surplus and leaving traders highly sensitive to harvest progress, producer selling and logistics. As a result, nearby coffee prices continue to respond to immediate supply constraints rather than forecasts alone.
Leonardo Rossetti, StoneX Brazil Market Intelligence Analyst, closely monitors Brazil's coffee production, exports and producer behavior. His perspective combines on-the-ground knowledge of the Brazilian harvest with analysis of global supply flows, providing early insight into when expanding production is likely to reach international markets.
Coffee inventories remain the strongest source of support for nearby prices despite increasingly bearish production forecasts. Rossetti notes that "the physical market, it's still very tight" and adds that "stocks are very low in several consumer regions", including Europe, Japan and exchange warehouses. Importers continue competing for limited immediately available supplies while waiting for Brazil's harvest to reach export markets. This imbalance explains why futures have priced a surplus while physical premiums have remained comparatively resilient.
Brazil's record coffee harvest is unlikely to ease inventory shortages until late in the third quarter. Rossetti explains that "from August and September we typically see the highest flow of deliveries", adding that weather delays have slowed harvesting, drying and processing. He also observes that financially stronger growers "don't have this urgency to sell and can wait for better opportunities", reducing immediate market availability. As larger export volumes eventually arrive, inventories should begin rebuilding, although weather developments could quickly alter expectations for the following crop.
Physical coffee supplies remain tight because Brazil's harvest has been delayed, producer selling has been slower than normal and inventories across major consuming regions remain low.
According to Leonardo Rossetti, the strongest increase in deliveries is expected from late August through September, when harvested coffee has been fully processed and becomes available for export.
Yes. While the current market focuses on expanding supply, El Niño could shift attention back to production risks for Brazil and other major coffee-producing regions heading into the 2027 crop.
Access analysis across the agricultural, energy, metals, and emerging currency markets, alongside critical insights into the factors influencing these markets over the upcoming quarter.
Access Today See our financial videos hub
--- Written by Frédéric Guetin, StoneX TV Producer
--- Expert: Leonardo Rossetti, StoneX Brazil Market Intelligence Analyst
The subsidiaries of StoneX Group Inc. provide financial products and services, including, but not limited to, physical commodities, securities, clearing, global payments, risk management, asset management, foreign exchange, and exchange-traded and over-the-counter derivatives. These financial products and services are offered in accordance with the applicable laws in the jurisdictions in which they are provided and are subject to specific terms, conditions, and restrictions contained in the terms of business applicable to each such offering. Not all products and services are available in all countries. The products and services offered by the StoneX Group of companies involve risk of loss and may not be suitable for all investors. Full Disclaimer. This content is not intended for residents of any particular country, and the information herein is not advice nor a recommendation to trade nor does it constitute an offer or solicitation to buy or sell any financial product or service, by any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Please refer to the Regulatory Disclosure section for entity-specific disclosures. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc. The information herein is provided for informational purposes only. This information is provided on an ‘as-is’ basis and may contain statements and opinions of the StoneX Group of companies as well as excerpts and/or information from public sources and third parties and no warranty, whether express or implied, is given as to its completeness or accuracy. Each company within the StoneX Group of companies (on its own behalf and on behalf of its directors, employees and agents) disclaims any and all liability as well as any third-party claim that may arise from the accuracy and/or completeness of the information detailed herein, as well as the use of or reliance on this information by the recipient, any member of its group or any third party.
© 2026 StoneX Group Inc. all rights reserved.
Our subscribers have access to comprehensive market analysis from StoneX spanning commodities, equities, currencies and more.
Coffee inventories remain unusually tight even as Brazil heads toward a record harvest and the largest global coffee surplus in years. The disconnect between physical availability and future supply expectations is creating a two-speed market that could keep volatility elevated through the second half of 2026.
July 7 – Two more ships were attacked exiting the Strait of Hormuz, but the market response has been little more than a yawn at this point. We saw a bump in crude oil prices, but crude oil is still near pre-war levels and the VIX still near multi-month lows. Stock futures are steady to mixed this morning, although the Dow Jones Industrial Average is poised for yet another possible record high today. The VIX is trading below 16 this morning, while the dollar index is trading near 100.9. Yields on 10-year Treasuries are trading near 4.50%, while yields on 2-year Treasuries are trading near 4.14%. WTI crude oil prices are trading near $69 per barrel, while Brent trades near $73 per barrel. The grain and oilseed complex traded mixed to firmer overnight, with wheat prices leaning weaker while soybeans leaned a bit firmer on Chinese buying.
Daily coffee report
Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.
Reach
With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bi-lateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.
Transparency
As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve; our financials and record of accomplishment are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.
Expertise
From our proprietary Market Intelligence platform, to “boots on the ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.
