Coffee futures slipped at the end of the trading week, posting a weekly loss. Coffee prices have failed to keep up with their 2023 momentum as a strengthening greenback and growing production volumes have weighed on the commodity.

July coffee futures tumbled $0.0075, or 0.41%, to $1.8085 per pound on Friday on the US ICE Futures exchange. Coffee recorded a weekly loss of more than 5%, but it is still up 8.2% year-to-date.

One of the biggest factors for the weakness in the coffee market has been a stronger greenback.

The US Dollar Index (DXY), which measures the greenback against a basket of currencies, has been resuscitated over the past month. The index was flat on Friday, trading at 104.23 and posting a weekly increase of 1%. The DXY has rallied more than 2.5% this month, lifting its year-to-date gain to 0.7%.

A stronger buck is bad for commodities priced in dollars because it makes it more expensive for foreign investors to purchase.

Greater output levels also affected coffee prices on Friday.

According to the US Department of Agriculture’s (USDA) Foreign Agriculture Service (FAS) forecast that Vietnam’s 2023-2024 coffee production would increase by 5% to 31.3 million bags. In addition, the USDA reported that Colombia’s 2023-2024 coffee output would swell by 2% to 11.6 million bags.

Overall, data from the International Coffee Organization (ICO) suggest that global coffee supplies have tightened in recent weeks, with worldwide coffee exports sliding more than 6% in the October-to-March period to 62.295 million bags.

In other agricultural commodities, July soybean futures climbed $0.1225, or 0.93%, to $13.3625 per bushel. July corn futures soared $0.1425, or 2.41%, to $6.05 per bushel. July wheat futures rallied $0.13, or 2.15%, to $6.1725 a bushel.