Thursday, 03 September 2015 17:05
HANOI: Coffee sales in Vietnam have been moderate with export prices easing this week while strong domestic consumption in Indonesia has limited export flows, traders said on Thursday.
ICE November robusta contract settled down $ 22, or 1.4 percent, at $ 1,581 per tonne on Wednesday, after hitting a contract low of $ 1,579 per tonne.
The contract has lost around 2 percent in the past week. Vietnamese robustas also eased further on domestic markets, while exporters quoted premiums of the beans grade 2, 5 percent black and broken at $ 65-$ 70 a tonne to the November contract, against $ 60-$ 70 early this week.
“Purchases on domestic markets are difficult, while taking 2,000-3,000 tonnes (a deal) from exporters is possible,” a trader in Ho Chi Minh City said, adding that more beans of higher-quality grade 1, screen 16 were available for sale now.
Vietnam and Indonesia account for a quarter of global coffee exports.
Domestic coffee sales in Vietnam were slow because buying prices now stood around 6 percent below the key level of 38 million dong ($ 1,690) a tonne, at which speculators and growers could release stocks, traders said.
Vietnam’s robustas grade 1, similar to Sumatran coffee, were offered at premiums of $ 110-$ 120 a tonne to November, while Indonesia’s Sumatran robusta grade 4, 80 defects were offered at a premium of $ 100 a tonne.
“Domestic producers are buying actively in Indonesia now,” a trader said, noting the flow for export so far this year has been higher than in the previous season.
Robusta exports from Indonesia’s main growing area in Sumatra rose 70 percent from a year earlier to 45,700 tonnes in August, government trade data showed.
The August volume brought Indonesia’s coffee exports in the current crop starting in April to nearly 131,000 tonnes, up nearly 51 percent from a year earlier, based on government data.
An Indonesian coffee industry group has lowered its output forecast to 500,000 tonnes this year from a previous estimate of 600,000-650,000 tonnes, due to the El Nino dry weather pattern.
On Indonesia’s arabica market, sellers were holding back stocks as benchmark arabica prices in New York extended losses, before the next harvest starts in the next months, a trader in Sumatra said.
