Vietnamese coffee prices range-bound

Vietnamese coffee prices stayed within a range of 40,400-42,000 dong ($1.94-$2.01) per kg on Tuesday as exporters refrained from making any new deals due to thin stocks, traders said. Trading was also slow because London's financial markets were closed on Monday. Vietnam is the world's top exporter of robusta coffee and prices closely track those of London-listed futures.
"Farmers are holding back sales because they consider the current prices too low," a trader at a foreign company in Ho Chi Minh City said. Farmers often retain a small part of their previous crop to blend with fresh beans from the new harvest, which is due to start in October.
Last week, robusta beans in Daklak, Vietnam's largest growing province, were quoted at 41,400-42,100 dong. Prices compared to London were mixed. Some exporters quoted Vietnamese robusta grade 2, 5 percent black and broken, at a discount of $10 a tonne or on par with London's November contract while others cited premiums of $20 to the contract. Bids stood at discounts of as much as $70 a tonne. The November contract ended up $14 last Friday at $2,055 a tonne, so Vietnamese coffee would be worth $1,985-$2,075 a tonne, on a free-on-board (FOB) basis.
Last week the beans were at discounts of $20 a tonne to London prices, and stood at $2,084 a tonne, FOB basis. "There have been very few deals, buyers are not active," another trader in Ho Chi Minh City said. Stocks held by farmers in the Central Highlands were estimated at 45,000 tonnes, while exporters and several foreign firms with warehouses in Vietnam may still have at least 150,000 tonnes, traders said.
Vietnamese exporters and foreign buyers appear reluctant to seal any deals that involve loading beans in the next few months due to fluctuating prices, traders said. Vietnam is estimated to have exported 120,000 tonnes, or 2 million bags, of coffee in August, soaring 189 percent from a year ago, the government said on Monday.
Traders had expected exports volume this month to fall to 70,000-100,000 tonnes, below July shipment. The export volume suggested the actual output from Vietnam's 2011/2012 crop year would be closer to 1.6 million tonnes than 1.5 million tonnes in recent revisions by some trading houses.