Weekly Coffee News: Asia Pacific

Coffee-related General News

While people in many Asian countries are slowly preparing for the new Lunar Year of the Snake after the Tet celebrations, the US Federal Reserve has decided against further interest rate cuts. Jerome Powell only wants to consider further interest rate cuts if inflation continues to fall or the US labor market weakens. The European Central Bank, on the other hand, decided on Thursday in favor of further interest rate cuts and, according to Christine Lagard, further easing will follow if the European economy does not pick up decisively in the coming months. The Bank of England will also be cutting interest rates soon; the economy is stagnating and is not really picking up again either.?

In the east of the Democratic Republic of Congo (DRC), troops of the rebel militia M23 have captured the capital of the province of North Kivu and are advancing further into the south and west of the country. The Rwandan army is said to be supporting the M23. The conflict between the M23 troops and the DR Congo government is nothing new and will not be resolved any time soon. The valuable mineral resources are extremely attractive for all sides.

In Nicaragua, President Daniel Ortega, who has been in office since 2007, expanded his power through constitutional reforms. He appointed his wife Rosario Murillo - currently still the country's vice president - as co-president. This means she can continue to govern without new elections in the event of his death.??

However, the coffee exchanges in New York and London appear to remain unimpressed by geopolitical events and the development of yield curves.?

Even if it almost looks like "the new normal", coffee prices have been soaring for over a month now. The combination of low (futures-market) inventories, high dependence on the producing countries Brazil and Vietnam (approx. 55% of global production), a relatively uncertain development forecast for the coming harvest in Brazil, and extreme financial liquidity bottlenecks is supporting this bull market. However, the other side of the "supply & demand" function (i.e. demand) seems to be completely disregarded at present. The sharp rise in prices - not only for coffee - is clearly noticeable for many households and is leading to falling demand. Significantly fewer goods end up in the shopping cart for the same 100 EUR/USD/GBP. Further geopolitical tensions threaten to further cloud the macroeconomic situation: Trump's tariff policy could trigger a backlash. Further threats to impose 100% tariffs on the BRICS countries (Brazil, Russia, India, China, and South Africa) if they do not continue to accept the USD as their reserve currency would also make the price of coffee significantly more expensive for US consumers. Foreign claims to sovereign states such as Canada and Greenland are also causing a lot of speculation and nervousness. So volatility will remain part of our new economic reality, and not just in the coffee market.?

As a result, coffee prices continued to rise, reaching new historic highs on Friday in New York (Arabica KCH25 at 381.05 c/lb) and London (Robusta RMH25 at USD 5,861/MT). Prices in New York rose by 8.7% last week. Since the beginning of the year, prices have increased by a full 15% and have doubled over the previous 12 months alone! On Friday, the March 25 contract closed at 377.85 c/lb.

Robusta prices followed a similar trend, closing the week at 5.718 USD/MT.?

In the following table, we update the most essential coffee key figures every week.?

Origin News

Indonesia

Indonesia has officially joined BRICS, a bloc of major developing economies including Brazil, Russia, India, China, and South Africa - among others, to strengthen economic and diplomatic ties. While its candidacy was approved in August 2023, formal accession was delayed until the newly elected government was established, with Prabowo Subianto now serving as Indonesia's eighth president.?

Wet weather continues across Indonesia, with Sumatra experiencing cloudy and rainy conditions. In Java, heavy rainfall has led to floods and landslides, causing bridge collapses, burying homes and vehicles, and resulting in at least 20 fatalities. Rain also persists in Flores and Bali.

Despite the weather-related delays, Sumatra's Arabica main crop is nearly complete, though drying remains challenging due to ongoing rain. Some forecasts suggest that this year's Robusta harvest in Sumatra could begin earlier than the usual April-May timeframe.

There are no updates coming from the Lampung port.

India

The Coffee Board of India has announced a new national certification for producers aimed at ensuring coffee is grown, processed, and sold in a way that is consistent and of high-quality standards. To support exports, the certification will be offered free of charge to Indian coffee farmers. Implementation modules are expected to be completed by June 2025, after which consultations with stakeholders will assess feasibility. Will this new certification help strengthen India's position in the global coffee market?

Weather conditions in India have improved. Coffee-producing regions in Karnataka, Kerala, Tamil Nadu, and Andhra Pradesh are experiencing warm, sunny days.?

The Arabica harvest is well advanced, with 75–85% completed. On the other hand, Robusta is at 25–35%. Market activity remains slow, with exporters selling less coffee than at this time last year. The first shipments of the new crop are set to begin their sea journey this month.

For 2024/25, the Coffee Exporters Association of India projects a record production of 6.3 million bags, comprising 1.3 million bags of Arabica and 5 million bags of Robusta.

No news from the ports of Cochin and Mangalore.

Vietnam?

The Ministry of Agriculture and Rural Development of Vietnam (MARD) has launched a database system to verify compliance with the EU Deforestation Regulations (EUDR) for coffee-growing areas. Developed in collaboration with the Netherlands-based trade platform IDH and JDE Peet's, the system aims to meet the EU's strict traceability requirements while supporting both short-term compliance and long-term sustainability goals.

The harvest is nearly complete, though persistent rain in the Central Highlands has impacted picking and drying processes. Before the Tet holidays, coffee flow improved as farmers sold ahead of the celebrations. Around 33% of the crop is estimated to have been sold before Tet, leaving two-thirds pending.

No significant developments have been reported at the Port of Ho Chi Minh.

Papua New Guinea

There is little news coming from PNG. Weather conditions in the Western and Eastern Highlands remain wet. The fly crop in the Western Highlands is slowly progressing and is expected to end soon.

No updates from the port of Lae.