Vietnamese coffee prices fell 1.3 percent on Tuesday to the lowest level in nearly 20 weeks, tracking a fall in London’s robusta futures market and prompting farmers to hold back sales.
Exporters widened their premiums to global prices after the price fall, leading buyers to switch to Indonesian origins, traders said.
Lower prices in Vietnam, the world’s top robusta producer, could lead to lower coffee exports as farmers hold on to their remaining stocks.
Last week traders projected Vietnam’s June coffee shipments at 90,000-110,000 tonnes (1.5 million to 1.83 million 60-kg bags), after an estimated 110,000 tonnes were exported last month. (Full Story)
“Sales are slowing as exporters hesitate because they have bought earlier while prices were higher,” a trader with an European firm in Ho Chi Minh City said.
On Tuesday, Vietnamese robusta widened to 38,700-40,200 dong ($1.84-$1.91) per kg in Daklak, Vietnam’s top growing province, from 40,000-41,300 dong a week ago. COFFEE/ASIA1
The price of 38,700 dong is on par with that on Jan. 23, Reuters data showed. Prices hit the year-low of 38,000 dong a kg during the week ended Jan. 12.
The selling pace has picked up in recent days, having pushed coffee futures prices down. London’s September contract LRCc2 lost $6, or 0.32 percent, to finish at $1,857 a tonne on Monday.
Coffee prices in Vietnam have lost around 10 percent in the past three months, and the agriculture ministry said the falls mean many exporters face losses.
Buyers have now switched to robusta beans in Indonesia, the Ho Chi Minh City-based trader said.
“Indonesia had a bit of problem last week with delivery due to rain, but it’s been dry now and the bean flow (to ports) has stabilised,” he said.
Exporters sought to sell at premiums of $70-$110 per tonne to London’s September for Vietnamese robusta grade 2, 5 percent black and broken beans, widening from premiums of $60-$80 a tonne last Tuesday.
The premium of $110 a tonne is the highest since at least the start of 2012. It compared with Indonesia’s premium of $150 a tonne to London’s September contract sought last week. (Full Story)