Asia Coffee: Vietnam braces for heavy rains

HANOI/BANDAR LAMPUNG: Vietnam’s Central Highlands is expected to face heavy rains this week that may disrupt coffee harvest in the country’s largest coffee-growing area, while supplies tightened in Indonesia at the end of the harvest, traders said on Thursday.

Rains would start from late Thursday until Saturday in the Central Highlands’ Kon Tum, Gia Lai, Dak Lak and Dak Nong provinces, the National Meteorological and Hydrological Center forecast.

“Rains may prevent beans from turning ripe and ready for harvest,” said a trader based in the coffee belt of Dak Lak.

“Cherry picking and processing might be delayed in some parts as a result.” According to traders, rains at this time of the year are worrisome as they have direct impact on both the quantity and quality of beans. Farmers in the Central Highlands, Vietnam’s largest coffee-growing area, sold beans at 46,100-47,000 dong ($1.92-$1.95) per kilogram, compared with last week’s range of 46,600-47,000 dong. Traders in Vietnam offered 5% black and broken grade 2 robusta at a discount of $100-$130 per tonne to the January contract. January robusta futures on ICE settled down $19, or 1%, at $2,141 per tonne on Wednesday.

Vietnam’s coffee exports in September were down 17.8% from the month before at 92,550 tonnes, government customs data showed. For the first nine months of 2022, Vietnam exported 1.34 million tonnes of coffee, up 13.1% from a year earlier. In Indonesia’s Lampung province, some traders increased prices of Sumatran robusta beans this week as harvest ended.

Beans were offered at a discount of $50 to the November contract, one trader said, compared with a discount of $80-$90 last week. “Stock is limited, while demand from exporters was pretty strong despite higher prices,” the trader said. Another trader offered a discount of $30-$40 to the November and December contracts, unchanged from last week.