London Coffee Futures - Nov 26 (RCX6)

Investing.com -- London Robusta Coffee Futures are under sustained selling pressure today, with the contract touching a session low of 3,411 after opening at 3,460 — a gap lower from the prior close of 3,481 that itself represented a key technical ceiling. The nearby Robusta contract had spent the prior session trading a wide range but ultimately failed to settle above its 50-day moving average at 3,481, a level that has acted as firm short-term resistance, and today's open directly beneath that threshold confirmed the bearish signal, inviting fresh selling from technically-oriented traders.

The most recent Commitment of Traders report showed funds had boosted their net-short position in Robusta coffee futures to a 13-month high, and that positioning overhang is now being expressed in price. On the fundamental side, global coffee supply is estimated at around 189 million bags for 2026/27, while consumption in major markets is expected to stand at only around 179 million bags, leaving a surplus of approximately 10 million bags — and as more coffee enters the market, export prices are likely to come under sustained downward pressure. Signs of bigger supplies from Vietnam, the world's largest Robusta producer, are a key undercutting factor, with September coffee exports rising 53% year-on-year to 124,000 metric tons.

On the macro and currency front, US inflation for September came in higher than expected, fueling a stronger US dollar and raising expectations for Federal Reserve interest rate action. The DXY reached a 52-week high of 102.95 on October 14, and while the index has pulled back modestly today, investors remain convinced that the Federal Reserve will keep rates at a restrictive level at its October policy meeting, maintaining upward pressure on the dollar that makes dollar-denominated commodities more expensive for overseas buyers. Equity markets are also offering a mixed backdrop, with the NASDAQ off 0.8% and the S&P 500 down 0.2%, reflecting a cautious risk environment that offers no tailwind to soft commodities.

The combination of a structurally oversupplied global coffee market, record-high Vietnamese export volumes entering a new crop year, technically confirmed resistance at 3,481, and a dollar near multi-year highs has created a self-reinforcing bearish loop for Robusta today. Prices have declined from 2024–2025 peaks due to oversupply in the global market, and farmers, traders, and exporters have released stocks amid concerns about further price declines — a dynamic that continues to cap any meaningful recovery attempt and keeps the path of least resistance firmly pointed lower.