Just noticed coffee prices are climbing today. May arabica is up 1.42% and robusta jumped 4.39% to a 2-week high. The shipping disruptions through the Strait of Hormuz are pushing up freight costs and insurance, which means higher import expenses for coffee traders and roasters.

Interesting thing is, while coffee prices are going up in the short term, the longer-term picture looks mixed. Brazil got some decent rainfall last week in Minas Gerais, which improved their crop outlook. Back in early February, Brazil's crop agency projected 2026 production could hit a record 66.2 million bags, up 17.2% year-over-year. That's a lot of supply coming.

Vietnam's also pumping out coffee like crazy. Their January exports surged 38.3% year-over-year to 198,000 MT, and 2025 production is projected at 1.76 million MT, up 6% from last year. So even though coffee prices are rallying today on supply chain concerns, the fundamental picture suggests there's going to be plenty of coffee in the market.

What's interesting is the inventory data. Arabica stocks recovered to 466,055 bags last week from their lows, and robusta inventories also bounced back. These recoveries are typically bearish for prices. Colombia's production fell 34% year-over-year though, which is one bright spot supporting the market.

So are coffee prices going up sustainably? Probably not in the long run given the record Brazilian crop forecasts and Vietnam's strong output. Today's rally looks more like a reaction to geopolitical disruptions rather than a fundamental supply shortage. The real question is whether these shipping cost increases stick around or if they fade once things normalize.