MILAN — Robusta futures prices rose for the second day in a row nearing a 15-year high of $2,970 set last week. The main contract for March delivery rose 2.3% to $2,936 on supply concerns in Vietnam, the world’s biggest producer of the Robusta bean. Arabica prices in New York were slightly higher, closing the day at 198.00 cents, or a 25 point increase over the previous day.
On Wednesday, Vietnam’s Ministry of Natural Resources and Environment said prolonged dryness and water shortages may hit Vietnam’s Central Highlands between March-June, with the impact of the El Nino weather pattern likely to continue into early 2024.
Coffee exports from Vietnam are estimated to have fallen 9.6% in 2023 from a year earlier to 1.6 million metric tons, government data showed on Friday.
However, export revenue rose 3.1% to $4.2 billion in the year, the government’s General Statistics Office said in a report.
Dealers said supplies remain tight with farmers in top robusta producer Vietnam holding onto newly harvested supplies in the hope that prices will rise further.
“Farmers are now cultivating fruit trees such as durian and passion fruit alongside coffee trees so they have multiple sources of income and don’t have much pressure to release beans,” one trader in Vietnam’s coffee belt said, quoted by Reuters.
Vietnamese coffee prices are forecast to continue to increase next year due to severe supply shortage, according to the Vietnam Coffee Cocoa Association (Vicofa).
Domestic prices on Monday temporarily moved sideways after a series of increases last week to record levels. Never has Vietnam experienced such a shortage of coffee, report local media.
Coffee prices were around VNĐ67,200 – 68,000 per kilogram in Tây Nguyên (Central Highlands) Lâm Đồng, Đắk Lắk and Đắk Nông, about VNĐ900 -1,000 per kg higher than last week and VNĐ8,000 than early December.
Vietnam’s green coffee price may be the highest in the world next year.
Premiums in Indonesia also rose due to a scarcity of beans, traders said on Thursday.
