HANOI/BANDAR LAMPUNG, (Indonesia): Domestic coffee prices in Vietnam, the world’s biggest robusta beans supplier, hovered near a 6-month high on Thursday, tracking a surge in global prices and limited supplies, while premiums dropped in Indonesia as new beans started to build up.
Farmers in the central highlands, Vietnam’s largest coffee-growing area, sold beans at 45,000 dong to 49,500 dong ($1.89 to $2.08) per kg, up from 43,700 dong to 44,500 dong last week.
“London prices have skyrocketed in the past week,” said a trader based in the coffee belt. “But farmers don’t seem to benefit from such high prices. Trade is very tepid.”
May robusta futures on ICE gained $133, at $2,205 per tonne as of Wednesday’s close, the highest level since October last year, Refinitiv data showed. Another trader said farmers in some areas of the coffee belt were switching to durian trees on hopes of better gains.
“Durian prices are going up day by day so they are cutting down coffee trees to have a place for durian.” In Indonesia’s Lampung province, price differentials narrowed amid higher benchmark prices and as new supply started to build up in the southern part of Sumatra island.
Sumatran robusta beans were offered at $40 premium to the March contract this week, down from $90 premium last week. Another trader offered $50 to $60 premium to the April and May contracts, down from $130 to $150 premium to the same contracts last week. “Prices dropped due to higher London prices and more bean supplies,” one of the traders said.
The main coffee bean harvest in the southern Sumatra region typically falls around mid-year, but some area usually have a mini harvest a few months earlier.
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