A jump in London's coffee prices extended discounts for Vietnam coffee amid weak demand and tightened Indonesia premiums during an ongoing mini harvest, traders said on Thursday. Premiums for Indonesia's grade 4 defect 80 robusta retreated to $70-$80 a tonne to London's July contract from a $110-$120 premium range a week earlier, traders said.
London's July contract jumped to as high as $1,845 a tonne on Tuesday, the highest intra-day level since November 17, 2017, while the US dollar also strengthened compared to the Indonesia rupiah, Thomson Reuters data showed. A few areas in Lampung province, a major robusta producing region in Sumatra island, are still supplying traders with beans from a mini harvest while demand is normal, an Indonesian-bsed trader said.
Indonesia's exports of Sumatran robusta beans from Lampung fell 65 percent in April on a year earlier to 4,011 tonnes, local government data showed on Wednesday, extending a decline in year-on-year exports to an eighth consecutive month. The country's main harvest is expected around June or July. Meanwhile in Vietnam, the worlds' second biggest coffee producer after Brazil, the discount for 5 percent black and broken grade 2 robusta grew to $100 a tonne from $60-$90 a week ago, traders said. "Demand is slow as London's future market is inverted but the recent spike in the London price has prompted farmers to release more beans," said a Ho Chi Minh-city based trader.