Coffee prices in Vietnam, the world's second-biggest producer after Brazil, hit a new year high of 19,000 dong ($1.19) per kilogram on Wednesday and traders said exporters were actively selling to cash in.
The rise in Vietnam, from 18,950 dong on Tuesday, tracks London futures market gains as speculators and fund buying pushed robusta prices to new five-month highs. The benchmark September contract closed $16 higher at $1,304 a tonne.
"Many people are selling for new contracts or asking to fix futures deals now," said a trader at a foreign firm in Ho Chi Minh City. Foreign firms were bidding discounts for September contracts at $25 to $30 a tonne, meaning Vietnamese robusta grade 2, 5 percent black and broken beans were priced at $1,274-$1,279 a tonne, free-on-board basis, up from $1,210-$1,230 on Tuesday.
Traders said the bids were easily accepted. On Wednesday's rise in Vietnam, the world's largest exporter of the robusta variety used widely for making instant coffee, is the latest in the past week's price rally as stocks have been dwindling during the period between crops.
Vietnam will start the new harvest in mid-October. The previous year-high in Vietnam was 18,600 dong per kg in February. "As soon as prices started firming, more coffee from who knows where arrives to the market for sale," the Ho Chi Minh City trader said.
Last week Vietnam estimated it has exported 726,000 tonnes of coffee in the first nine-month of the current coffee crop year ending this September, up 12.6 percent from a year. The government estimate means Vietnam still has more than 70,000 tonnes of coffee left, based on traders' estimates of the crop output of 720,000 tonnes, plus 130,000 tonnes carried over from the previous crop.
Domestic consumption is estimated at 50,000 tonnes. Traders said they might have to look and revise their crop output estimates, given the recent active sale by Vietnamese exporters.
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