(Bloomberg) — Arabica coffee futures climbed in New York as dry weather in top grower Brazil continues to stoke bullish sentiment.
Prices of arabica, the variety favored by chains such as Starbucks Corp. for specialty brews, climbed as much as 3% to the highest price in two weeks on Friday. Robusta futures in London also gained. The ongoing dry weather, continued decline in certified stockpiles and potential weather-driven fund buying are likely key drivers of the upward price movement, Rabobank analyst Oran van Dort said.
Timely precipitation is key to support the recent flowering and ease market concerns, especially given no rain has fallen since Sept. 23, Dort added. “If forecasted rain does occur, we could see prices trend downward.”
The main flowering stage for Brazil’s 2026-27 crop already took place, but rains this month “will be crucial” for the crop’s continued development, broker Thiago Cazarini wrote in a Thursday report. Good weather could boost production by 20% year-over-year, but the market seems “more inclined into bullish than bearish,” he said.
Dry and hot weather will intensify over coffee-growing areas in the South American nation by the end of the week, Climatempo meteorologist Nadiara Pereira said in a report Friday. Daytime temperatures will continue to rise and are expected to lead to heat stress in some areas.
A likely transition to a La Niña weather pattern from October to December — which typically brings drier weather to South America — also adds risks to coffee development.
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