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Tuesday, May 30, 2023

Asia coffee: Thin supplies in major Asian robusta producers

HANOI/BANDAR LAMPUNG, (Indonesia): Coffee supplies tightened in Vietnam this week as farmers who had already sold most of their stocks refrained from releasing the remaining beans, while rainfall in Indonesia hit output there, traders said on Thursday. Farmers in the central highlands, Vietnam’s largest coffee-growing area, sold beans at 47,700 dong to 48,800 dong ($2.03-$2.08) per kilogramme, compared with 46,000 dong to 48,500 dong range a week ago.

Traders in Vietnam offered 5% black and broken-grade 2 robusta at a premium range of $20-$30 per tonne to the July contract. Traders offered a $10-$20 discount range last week to the May contract. “Demand is healthy, but both Vietnam and Indonesia have very few beans to offer,” said a trader based in the coffee belt.

“We are monitoring the weather condition closely to prepare for possible drought this year.

At this point it hasn’t rained yet.” July robusta coffee settled down $9, at $2,145 on Wednesday. Coffee exports from Vietnam are estimated to have decreased 1.6% in the first quarter of 2023 from a year earlier to 572,000 tonnes, equivalent to 9.5 million 60-kg (130-pound) bags, official data showed.

In Indonesia, Sumatran robusta coffee beans this week were offered at $160 premium to the July contract, up from a $70 premium to the May contract last week.

“Higher price was because of limited supplies. Exporters are fighting over coffee in the market,” the trader said. “Rainfalls were the reason for beans scarcity and shorter harvest time.” Another trader said for the May-June contract, the beans were offered at a $160-$170 premium range, up from last week’s $100-$120 premium, as the rupiah strengthened, while local exporters could also sell at $200 for May contracts.

Source: Brecorder

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