Commodities June 16, 2026 03:25 PM

Arabica futures surge 5.2% as Brazil harvest disruptions and El Nino worries mount

Short covering, wet weather at Brazilian drying yards and falling certified stocks lift coffee; sugar and cocoa also tick higher

By Avery Klein
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Arabica coffee futures climbed sharply on ICE as traders covered short positions amid concerns over delayed harvesting in Brazil, a forming El Nino pattern and declining certified stock levels. Robusta and sugar contracts also moved higher, while dealers noted crude oil weakness earlier had weighed on the sugar market.

Arabica futures surge 5.2% as Brazil harvest disruptions and El Nino worries mount
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Key Points

  • Arabica futures jumped 13.6 cents (5.2%) to $2.728 per pound as traders covered short positions amid concerns over Brazil's delayed harvest and falling certified stocks - impacts commodities and agricultural markets.
  • Robusta coffee rose 2% to $3,598 per metric ton; sugar contracts also moved higher, with raw sugar at 13.82 cents per pound and white sugar at $449.90 per ton - affecting sugar producers and commodity traders.
  • An El Nino event has formed and could intensify in late 2026, a development seen as potentially reducing production for the 2026/27 season - relevant for agricultural supply forecasts and commodity pricing.

Arabica coffee futures posted a notable gain on Tuesday on the ICE exchange as market participants trimmed short exposure and supply concerns increased. The benchmark contract settled 13.6 cents higher, a 5.2% rise, at $2.728 per pound.

Market analysts pointed to several supply-side pressures behind the rally. StoneX coffee analyst Leonardo Rossetti said speculators who had shifted into a net short position last week may have been forced to cover some of those positions in response to growing worries about a delayed harvest in Brazil.

Heavy rain over recent days soaked coffee that was laid out to dry at farmyards in major producing regions of Brazil, the world’s top producer and exporter, and interrupted field harvesting operations. Those wet conditions, combined with a decline in certified stock levels, added to the sense of tightening availability among traders.

Robusta coffee futures also advanced, gaining 2% to settle at $3,598 per metric ton.

Sugar contracts moved higher alongside coffee. Raw sugar finished up 0.14 cent, or 1%, at 13.82 cents per pound after earlier touching a near two-month low of 13.56 cents during the session. Market participants said an initial drop in crude oil prices had placed downward pressure on the sugar market earlier in the day.

Looking further ahead, forecasts for the 2026/27 season appear more constructive for prices because an El Nino weather event is expected to curtail production. Australia’s national weather bureau issued a warning on Tuesday that an El Nino pattern has formed in the tropical Pacific and could strengthen in the second half of 2026, potentially becoming one of the strongest in seven decades.

White sugar contracts rose 1.7% to $449.90 per ton. Cocoa prices were also reported to have climbed during the session.


Summary of market moves and drivers:

  • Arabica coffee up 13.6 cents to $2.728 per pound, a 5.2% increase.
  • Robusta coffee rose 2% to $3,598 per metric ton.
  • Raw sugar gained 0.14 cent to 13.82 cents per pound after earlier hitting 13.56 cents; white sugar up to $449.90 per ton.
  • Drivers cited include short covering, rain-soaked drying yards in Brazil, lower certified stock levels, and the prospect of a strengthening El Nino.

Risks

  • Ongoing wet weather in Brazil has soaked coffee drying in farmyards and halted field work, introducing uncertainty in near-term supply and harvest timing - a direct risk to coffee availability and prices.
  • A strengthening El Nino could reduce production in the 2026/27 season, creating downside supply risks for crops - a climatic uncertainty for agricultural markets.
  • Volatility in crude oil prices can influence sugar markets, as a decline in oil initially put downward pressure on sugar, creating an indirect risk from energy markets to sugar pricing.

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