Domestic coffee prices pick up in Vietnam on global cues, tight supplies

HANOI - Vietnam's domestic coffee prices edged up on Thursday, on upbeat global prices and limited supplies as farmers refrained from selling the bean on hopes that prices could rise further, traders said.

A worker shows coffee beans at coffee company Simexco Dak Lak Limited in the city of Di An, Binh Duong Province, Vietnam. Photo: Reuters

Farmers in the Central Highlands, Vietnam's coffee-growing capital, sold coffee at VND33,500-34,000 ($1.46-$1.48) per kg, up from last week's VND32,300.

May robusta coffee on Wednesday settled at its highest level in a year, at $1,463 per metric ton, Refinitiv Eikon data showed.

"Domestic prices inched up this week following a skyrocket in global prices," a trader based in the coffee belt said.

"Farmers are not under pressure to release beans to cash in for holiday anymore and are hoping prices would edge up further so supplies are very tight."

Another trader also based in the region said farmers had already sold 40%-50% of their beans harvested in the 2020/21 crop year that began on Oct. 1.

Traders in Vietnam offered 5% black and broken grade 2 robusta at a premium of $60 to the May contract, down from $90-$100 premiums last week.

Meanwhile, premiums for robusta beans in Indonesia's Lampung province fell for the second week, with one trader offering $220 premium to the April contract, down from $270-$280 premium last week.

Another also trader based in the Lampung region offered $200 premium to the May contract, down from $280 premium last week.

"The benchmark price went up significantly this week, so the premium has to be narrower," one of the traders said.

"Meanwhile, stocks remain low since farmers are still waiting for the upcoming mini harvest."