Crop Forecast: Coffee Brazil 2025/26

In this report, we'll discuss our forecast for the 25/26 Brazilian crop in more detail, particularly in light of the update made at the end of January to the Arabica and Conilon figures. Total production for the 25/26 season is estimated at 64.1 million bags, a slight increase of 1.1%, but only driven by conilon production given the expected decline in arabica.

After the drought and high temperatures between August and September 2024, rainfall returned more evenly to the country's Arabica coffee-producing regions in October, helping to improve the condition of the crop and the filling of the beans. Only in January 2025 did rainfall remain below average, although in February rainfall returned intensely, with the first week of the month recording a volume higher than the monthly cumulative volume of 2024 and 2025.

However, when analyzing the regional figures, there are some differences between the producing regions, which are also reflected in our production models. In Minas Gerais, for example, there were differences in rainfall within the state: both the South of Minas and the Zona da Mata recorded below cumulative average in 2024 and early 2025 (although the February rains could change this), while in the Cerrado Mineiro, rainfall was closer to historical norms. Average temperatures remained above the 10-year average in all regions. The weather was also reflected in soil moisture, with the first two regions experiencing the lowest levels in years, while in the Cerrado Mineiro this indicator was close to historical averages by the end of the year.

As a result, the expected reduction in Arabica production for the 2025/2026 season was largely attributed to lower estimates in South Minas Gerais and the Zona da Mata. Additionally, producing regions in the state of São Paulo were significantly impacted by weather conditions, with rainfall levels falling below the 10-year average in both 2024 and early 2025.

In addition to the climatic factor, many producers in the Arabica regions were prompted to increase pruning in their plantations as trees were affected by the drought, prioritizing vegetative growth for the 26/27 harvest. While it is expected that some of these farmers have opted to prune only the lowest branches of the plant – to harvest from the canopy at high prices - this could also result in lower production. As a result, we have lowered our Arabica production forecast for 25/26 to 41.1 million bags from 42.6 million bags in November/24, down 4.9% from 24/25.

With lower production expected, we also estimate that Brazilian Arabica exports could be lower on 25/26, especially compared to 24/25, where shipments are on track for record levels. In addition, while commercialization of the 24/25 crop is above average, we estimate that Brazilian Arabica stocks may start the next cycle at low levels, limiting new sales. On the consumption side, at current price levels and with Conilon prices once again lower than Arabica, we expect roasters to use more Conilon in national blends, reducing Arabica consumption.

On the Conilon side, expectations are more optimistic. In Espírito Santo, the largest producing region, rainfall was in line with historical averages, including between August and September, when the first blooms occurred. In addition, producers have continued to invest in coffee plantations, not only in ES, but also in Bahia and Rondônia, with the rise of prices between 2023 and 2024. In these regions, the weather was also favorable for the development of the 25/26 crop. As a result, we have raised our production estimate from 22.6 million bags in November to 23 million bags, an increase of 14.3% compared to 24/25. However, carryover stocks could start the 25/26 crop at the lowest level in decades.

On the other hand, with increased production in Brazil and even lower stocks and production in other producers such as Vietnam, we are forecasting an increase in Brazilian conilon exports in 25/26, although this could be limited by lower stocks. As noted above, given the current price differential between Arabica and Conilon, we also expect an increase in domestic consumption of the variety in 25/26.