Asia Coffee-Vietnam prices unchanged from last week; Indonesia premiums rise

BANDAR LAMPUNG: Vietnam's domestic coffee prices remained flat on Thursday from a week earlier with supplies from farmers running low, while Indonesian premiums widened to compensate for weaker dollar against the rupiah.

Farmers in the Central Highlands, Vietnam's largest coffee-growing area, sold coffee at 32,000 dong ($1.38) per kg, unchanged from last week.

"Farmers refused to release their remaining 2-5pc output of this year at the current price as it is below the production cost. However, we can't offer higher given the renewed US-China tensions and the coronavirus outbreak," said a trader based in Ho Chi Minh City.

"None of us, traders and growers can make profit now."

Another trader based in the Central Highlands said it had been raining for the past few weeks.

"The weather has been much more favourable now but as the drought came earlier than usual this year, smaller-sized beans are expected this 2020/21 crop season," he said.

September robusta coffee settled up $20, or 2pc, at $1,218 per tonne on Wednesday.

Traders in Vietnam offered 5pc black and broken grade 2 robusta at $200 premium per tonne to the September contract.

The premiums were $200-$220 per tonne to the July contract.

Meanwhile, Indonesia's robusta beans in Sumatra's Lampung province are offered with a premium of $350 to the July contract, up from last week's $290-$300 premium, a coffee exporter said.

The exporter said traders increased premium steeply this week to compensate for weaker dollar against the rupiah.

Indonesian rupiah has gained more than 3pc against the dollar so far this week as foreign investors pour back in into its high-yielding bond market.

Indonesia exported 7,966.2 tonnes of Sumatran robusta coffee beans from Lampung province in May, down 9pc from a year earlier, official data showed.