HANOI/BANDAR LAMPUNG: Year-end holidays subdued coffee trading in Asia, where farmers were reluctant to release beans, while premiums in Indonesia rose due to beans scarcity, traders said on Thursday.
Farmers in the central highlands, Vietnam’s largest coffee-growing area, were selling beans for 67,000-68,500 dong ($2.76-$2.82) per kg, down from last week’s 69,700-70,200 dong range.
“Both demand and supply are weak this week as international traders have entered holidays while farmers are not selling,” said a trader based in the coffee belt.
“Farmers are now cultivating fruit trees such durian and passion fruit alongside coffee trees so they are have multiple sources of income and don’t have much pressure to release beans,” the trader added.
Another trader said supplies had been scarce over the past six months. “The prices are too high now. It’s challenging to buy beans at the moment,” the trader said. “Most deals sealed in the past two-three months were to fulfil signed contracts of the previous crop season.”
March robusta coffee settled up $32 to $2,869 in a week, as of Wednesday’s close. Traders offered 5% black and broken-grade 2 robusta at a premium range of $20-$40 per tonne to the March contract, down from $60-$70 premium last week.
In Indonesia, Sumatra robusta coffee beans were offered at a premium of $600 per tonne this week to the January-February, compared with $540-550 premium a week ago. “Coffee stock is declining so the prices remain high,” one trader said.
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