Coffee trading in Vietnam resumed at a slow pace after a break for the Tet new year festival, as weaker international markets prompted sellers to hold back supplies of beans in the expectation of higher prices later, traders said on Tuesday. Farmers sold small volumes during the January 21-29 national holiday, a trader in the top coffee growing province of Daklak said, but official trading only started on Monday.
"Farmers have no need to rush to sell the beans now. Many of them sold to pay back loans to banks and creditors and cover expenses before Tet already," he said. Despite large stocks, farmers are not under pressure to sell beans as they don't need to pay for fertiliser for the next crop until the early rainy season, which falls in April or early May in the Central Highlands, a trader in Ho Chi Minh City said.
Farmers finished harvesting the 2011/12 crop early this month, and only a small volume of arabica beans are now under work. Robusta beans fell to 37 million dong ($1,763) a tonne in Daklak on Tuesday from 37.4 million dong before Tet, tracking a downturn in international markets. March robustas futures on Liffe slipped $22, or 1.2 percent, to close at $1,843 a tonne on Monday.
Buyers were also reluctant to purchase beans and kept the discounts at $40-50 a tonne to the March contract, loading this month, the trader in Ho Chi Minh City said. Some exporters offered premiums for robusta grade 2, 5 percent black and broken beans at $5-10 a tonne, versus a $10-20 a tonne premium on January 17, traders said. Robusta beans ranged between $1,793-$1,853 per tonne on Tuesday, on a free-on-board basis, against $1,804-1,874 before Tet.
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