Brazil is expected to harvest 64,7 million bags of coffee in the 2025/26 harvest.

Rainfall in the main Arabica-producing regions for most of 2024, especially during the flowering phase of the 25/26 cycle, was below average, negatively impacting the harvest. In 2025, despite good rainfall in January and early February, a dry spell hit the coffee-growing regions of Minas Gerais and São Paulo, reducing overall crop yields.

Analysis by Hedgepoint Global Markets indicates a reduction in Arabica estimates from 39,6 million bags to 37,7 million bags compared to its last projection, a 13,3% decrease compared to 24/25. However, the Conilon/Robusta estimate was increased to 27 million bags, a 30% increase compared to 24/25. This resulted in total production of 64,7 million bags, a small increase of 0,7% compared to 24/25.

Regionally, the Cerrado Mineiro region saw precipitation in line with or even above historical average levels in 2024 and 2025, which in turn led to weighted cumulative precipitation in Minas Gerais closer to average levels, especially in 2024. However, both the South of Minas Gerais and the Zona da Mata region still recorded lower precipitation levels. This was also reflected in the regions' productivity, which became clearer after the harvest. Both regions experienced quality issues, with a higher percentage of mocha beans. However, the harvest recorded a higher percentage of 17/18 sieves compared to the 24/25 harvest.

"In the state of São Paulo, the lack of rain was widespread, resulting in quality and productivity problems similar to those in the southern regions of Minas Gerais and Zona da Mata. Given this scenario, Arabica production was revised downward from Hedgepoint's initial forecast to 37,7 million bags, representing a 13,3% decrease compared to the 24/25 harvest," says Laleska Moda, market intelligence analyst at Hedgepoint Global Markets.

According to her, the outlook for the 26/27 harvest is still unpredictable. Although higher rainfall levels in April affected the 25/26 harvest, they helped improve the condition of the coffee trees. "Furthermore, higher coffee prices in recent years have allowed farmers to invest more in their crops, suggesting positive potential for the 26/27 harvest. However, the next cycle will depend heavily on rainfall levels in the coming months, which are essential for flowering," she says.

On the other hand, the analyst highlights that Conilon areas, particularly in the states of Espírito Santo and Bahia, had more favorable conditions for the 25/26 harvest, with average rainfall levels. "Not only is the climate forecast more positive, but farmers also invested more in their crops due to higher coffee prices since the end of 2023. These factors led to higher-than-expected productivity and processing yields. Consequently, the production estimate for this variety was increased to 27 million bags for the harvest, a 30% increase compared to the 24/25 harvest," she explains.

Expectations for production in Espírito Santo

The report highlights that flowers for the 26/27 harvest have begun to open, particularly in Espírito Santo, a good sign for the next cycle. Since August, the weather in the state and southern Bahia (the state's main conilon-producing region) has brought more rainfall, essential for flower set. Furthermore, it should be noted that coffee growers have increased their conilon production areas in recent years, with some already producing in the 26/27 harvest. If the weather continues to be favorable, positive results are expected in the next harvest.

The reduction in Arabica production and the increase in Conilon production are also expected to affect domestic demand and export figures, due to changes in prices and availability. The current difference between Arabica and Conilon prices could lead to an increase in the use of Conilon in the country's mix, as Brazilian industries look for ways to reduce costs. "Indeed, although most coffee growers are currently selling only small volumes, Conilon producers are redirecting most of their sales to the domestic market," he states.

According to the analyst, a sharper decline in Arabica use in the Brazilian market is expected, but an increase in Conilon use in the 25/26 harvest. However, total domestic demand may decline slightly by 1,2%, given current higher prices, reaching a total of 21,7 million bags. Regarding exports, the reduced availability of Arabica and the current arbitrage between Arabica and Robusta futures prices could lead to a decrease in Arabica exports in the 25/26 harvest, as destinations may favor Robusta consumption.

The current tariff situation between the US and Brazil could also contribute to this scenario, as the US imports most of its Arabica coffee from Brazil. "We expect a slight decrease in Brazilian Conilon exports, as a significant portion of Brazilian production will be redirected to the domestic market. Furthermore, other origins, such as Vietnam, Indonesia, and Uganda, are expected to increase exports due to favorable production prospects and more competitive advantages," he says.