The continuing harvest kept coffee bean supply steady in Vietnam, the world's second biggest producer, while trading in Indonesia remained subdued on low stockpiles, traders said on Thursday. Vietnamese farmers have been ramping up their harvest of coffee beans in the Central Highlands, the country's coffee belt. Traders said the weather had been supportive.
Farmers in Daklak, Vietnam's main coffee growing province, were offering coffee beans at a price range of 37,100-37,700 dong ($1.63-$1.66) per kg, widening from a range of 37,300-37,500 dong a week earlier, traders said. Vietnam's 5 percent black and broken grade 2 robusta was traded at a discount of $50-$65 per tonne to the ICE March futures contract, expanding from a $40 discount a week earlier, traders said. Falling London prices kept farmers from releasing too many beans into the market but supply was still enough for buyers, said Phan Hung Anh, a deputy director of Anh Minh Co based in Daklak, adding demand had been quite good.
But another trader based in Ho Chi Minh City said demand from roasters, the main buyers of the more bitter robusta beans, were not as high as usual at this time of year when buyers boost purchases before the Christmas holiday. January robusta coffee slid as low as $1,699 a tonne this week, the weakest for the second position since June 2016, on expectations of a large crop in Vietnam and an improving outlook for next year's Brazilian crop. Coffee exports from Vietnam this month are expected to reach 85,000 tonnes, down 26 percent from the same time last year but up from October's 79,000 tonnes. January-November exports of the bean fell an estimated 22.4 percent annually to 1.27 million tonnes, the government said.
In Indonesia, the grade 4 defect 80 robusta beans traded at a premium of $80-$90 a tonne to the January contract, expanding from a $50 premium a week earlier, a trader said. Premiums in Lampung were set higher to balance a big drop in London prices, although trade activity was still thin due to depleted stock, a trader said.