Brazilian coffee monthly update: July 2025

In June, Brazil exported 2.6m 60kg bags of coffee, down 12% from May and 28% YOY. For the 2024/25 crop year (July-June), total exports reached 45.6m bags. Despite a 4% decline from the previous season, this marks the third-largest volume on record, behind 2023/24 and 2020/21. The recent slowdown aligns with expectations, given past disappointing harvests and record exports in 2024. We project 2025 exports to be around 42m bags.

The barter ratio has worsened in recent weeks due to falling coffee prices and rising fertilizer costs, especially for urea. In July, 1.6 bags of coffee were needed to purchase one metric ton of fertilizer (blend 20-05-20) – a 35% increase since January and 10% higher than last month (1.2 and 1.4 bags, respectively). Still, this is better than the same period last year, when 1.7 bags were required.

Before the US announced a 50% tariff on Brazilian coffee imports, prices were trending downward. From January to July, arabica and conilon prices in Brazil fell 25% and 47%, respectively – driven by Brazil’s current harvest and optimistic global supply outlooks, especially in Brazil and Vietnam.

Since the tariff announcement, market volatility has increased, likely due to buyers seeking alternative origins. So far, no cancellations of existing contracts have been reported, but new purchases have stalled. Both exporters and importers are awaiting clarity. It is still too early to assess the long-term effects, as it will be crucial to observe whether the tariff is fully implemented and how long it remains in effect. This measure could reshape international coffee trade flows, with implications for producers, exporters, and consumers.

Although June is typically dry, above-average rainfall in some regions has delayed harvesting and may affect bean quality. However, Brazil’s harvest is progressing well. Private sources report that over 50% of the arabica crop and more than 90% of the conilon crop have been harvested. However, yield issues are emerging – more coffee cherries are needed to produce a bag of processed coffee (lower “outturn”), likely due to low rainfall in February, as previously forecast during our Crop Tour.