Vietnamese coffee prices hit 41.6 million dong ($1,996) a tonne on Tuesday, the highest in nearly seven months, but farmers were slowing sales due to thin stocks and in hopes of further price gains, despite forecasts of another big harvest, traders said.
Robusta beans hit a range of 41.2 million to 41.6 million dong ($1,976-$1,996) a tonne in Daklak, Vietnam's top coffee growing province, from 40.7 million to 40.8 million dong last Friday following gains overnight on London's robusta futures market, traders said.
"Sales are slowing now after farmers sold strongly late last week," said a trader in Buon Ma Thuot city, the capital of Daklak. "After prices rose beyond 41,000 dong (per kg) they have slowed selling as stocks have become thinner."
Daklak produces a third of Vietnam's coffee. The Southeast Asian nation is the world's second-largest producer after Brazil and the top producer of robusta beans, used mainly to make soluble coffee. Robusta prices in Vietnam rose to their highest since last December last Friday, indicating farmers could step up sales to lock in profits while stocks were thinning, traders said.
"Farmers who can still hold beans when prices reached the current level would now want to keep them until prices rise to 43,000-45,000 dong," the Buon Ma Thuot trader said. Daklak's output from the next 2012/2013 crop is forecast to rise around 10 percent to 430,000 to 450,000 tonnes, or 7.2 million to 7.5 million bags, thanks to good weather, an industry official said in late April.
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