Vietnam’s Coffee Sales Slow after London Prices Drop

24-May-2012 Intellasia | Reuters | 7:01 AM Print This Post

Vietnam’s coffee exports slowed on Tuesday after picking up late last week as farmers held back stocks, awaiting higher prices, traders said.

Coffee supplies are already thin at the tail-end of the harvest while demand remains strong for Vietnam’s robusta beans, which helped push prices in the Central Highlands growing belt to their highest in seven months last week.

Traders said robusta sold at between 42,000-42,500 dong ($2.01-$2.04) a kilogram, but prices eased on Tuesday to 41,400-41,800 dong per kilogram after July robusta futures on the Liffe lost 2.5 percent to end at $2,162 a tonne on Monday.

Vietnam is the world’s top producer and exporter of robusta beans.

“It’s not possible to buy today, farmers stopped selling after prices dropped,” a dealer said by telephone from Buon Ma Thuot, the capital of Dak Lak, Vietnam’s top growing province.

Exporters sought to sell Vietnamese robusta grade 2, 5 percent black and broken at a discount of $20 a tonne to the July contract, but traders said the acceptable levels could be $30-$40 per tonne, down from a gap of $40-$50 last Tuesday.

Such pricing placed the Vietnamese beans at $2,122-$2,142 a tonne, free-on-board Saigon Port, up from $2,086-$2,096 a tonne a week ago.

Vietnam is set to produce another bumper coffee crop in 2012/2013, with output expected to be on par with the current 2011/2012 season, traders said.

“The weather has been very favourable and trees look very good now,” said a dealer from Gia Lai, the fourth-largest growing province after Dak Lak, Lam Dong and Dak Nong.

Traders estimated the current 2011/2012 crop output at 22.5 million bags, which would be a record high.

 


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