HANOI/BANDAR LAMPUNG: Vietnam’s coffee output is expected to drop by a fifth in the current crop year as extended rains, lower levels of nutrition have hit the quality of beans, while trade was thin in Indonesia on low supply, traders said on Thursday.
Farmers in the Central Highlands, Vietnam’s largest coffee-growing area, sold beans at 40,100 dong to 42,000 dong ($1.69-$1.77) per kg, compared with last week’s 40,000 dong to 40,800 dong.
“Farmers have harvested most of their crop and the outcome is not very promising. Output is going to be 20% lower than previously forecast,” said a trader based in the coffee belt.
“Rains in November hindered cherry picking and processing in some parts while some trees were malnourished as fertilizer prices were high due to supply chain disruption and the ongoing Ukraine-Russia conflict,” the trader added.
According to a Reuters poll, Vietnam was forecast to have a crop of 30 million bags of 60 kg each in 2022/23, slightly below the prior season.
Another trader said trade activities were tepid as buyers and sellers could not reach a deal on prices. A trader offered 5% black and broken-grade 2 robusta at a discount range of $70 to $80 per tonne to the May contract. Last week, beans were offered at $60 to $70 discount to the March contract.
In Indonesia’s Lampung province, Sumatran robusta beans were offered at a premium of $100 to the January contract, up from last week’s $80 premium due to depleted stock, but trade was thin. “There were barely any trades because stock is getting low.
Activities may improve from the beginning of next year,” one trader said. Another trader offered $120 premium to the January and February contract, up from $50 to $80 premium range last week.
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