HANOI: Trading in Vietnamese coffee slowed to a trickle this week as growers and exporters were reluctant to sell due to a slide in global prices, while foreign buyers did not rush for deals, traders said on Tuesday. Prices on London’s robusta futures market eased on Monday, with the January contract settling down 0.3 percent at $1,553 per ton, after touching a four-week low of $1,543.
In Vietnam, robusta beans <COFVN-DAK> slid to 33,800-34,700 dong ($1.52-$1.56) per kg this week in the country’s top growing province of Daklak, from 35,100-35,800 dong a week ago.
At 33,800 dong the price is the lowest since Sept. 23, having dropped 5 percent so far in the crop year that began on Oct. 1, compared with the 0.25 percent fall in the same period last year, based on Reuters data. Premiums of Vietnamese robusta grade 2, 5 percent black and broken widened to $50-$60 a ton to the January contract, from a premium of $40 last Tuesday.
Foreign buyers’ bids stood between a discount of $20 a ton and premiums of $30-$40. “The carryover stocks are high so buyers do not have to rush to buy now,” a trader at a European firm in Ho Chi Minh City said.
The world’s top robusta producer started the new 2015/2016 crop with stocks from the previous season at a record level of between 350,000 and 500,000 tons based on estimates by the government and traders. Hoarding since late February 2015 by Vietnamese sellers, many of them speculators, with hopes for high gains has led to the high stocks.
Vietnam’s coffee exports in the October 2014-September 2015 season fell 22.7 percent from a year earlier to 1.26 million tons (21 million bags), government data showed on Monday. In the Central Highlands coffee belt harvesting of the 2015/2016 crop has been completed on up to 5 percent of the total area, and traders said the size of new cherries was still small. The harvest will peak from mid-November.
January-October’s coffee exports fell 29 percent from a year earlier to 1.06 million tons, and revenue dropped 30.8 percent in the period to $2.15 billion, based on government data. Coffee brought in $3.55 billion in the whole of 2014. The bitter beans, used mostly for making soluble coffee, is Vietnam’s second-biggest cash earner among agricultural produce after rice.
