MXV-Index has 4th consecutive recovery session, coffee leads the increase

(Chinhphu.vn) - According to the Vietnam Commodity Exchange (MXV), coffee became a bright spot in yesterday's session when both Arabica and Robusta simultaneously increased by about 4%, acting as the main driving force for the entire raw material market. At the end of the session, the MXV-Index extended its recovery streak to the fourth day, increasing by 0.4% to 2,177 points.

Fears of shortages cause coffee market to surge

Closing the trading session on August 11, the green color continued to be maintained on most items in the industrial raw materials group. Notably, two coffee items stood out. Specifically, the price of Arabica coffee increased by nearly 3.8% to 7,070 USD/ton while the price of Robusta coffee recorded an increase of nearly 4.4% to 3,664 USD/ton.

According to MXV, concerns about a shortage of Arabica coffee supply supported the increase in coffee prices in yesterday's session. Many producers forecast that Brazil's coffee production in 2025-2026 will decrease sharply, with Arabica production alone possibly decreasing by 12% to 30%.

According to a report from Pine Agronegócios, key coffee producing regions and consuming markets are currently operating with limited inventories, making it difficult for prices to fall significantly, especially as the climate conditions for the next crop are still not really favorable. The latest records at the ICE Exchange show that Arabica coffee inventories continue to decline, reaching a more than 14-month low of just 737,609 bags. Robusta inventories monitored by ICE also fell to a two-week low of 6,981 lots yesterday, after reaching a one-year high of 7,029 lots on July 28.

According to data from the Ministry of Foreign Trade Secex, the average daily coffee export in the first six days of August was only 6,100 tons, a sharp decrease of 35.4% compared to the average of 9,400 tons/day in August 2024. The total export volume in the first six days of the month was only 36,500 tons, much lower than the 207,000 tons in the whole of August last year.

In the coffee derivatives market, the Managed Money Fund increased its net long position by 0.21% to 21,459 lots, while the Index Fund decreased by 4.52% to 31,569 lots. In the London robusta market, the hedge fund reduced its net short position by 3.12% to 5,671 lots (about 945,167 bags), indicating that the net short position was generally flat after a period of active trading.

Silver prices recorded the biggest drop since early August

According to MXV, the metal market also attracted investors' attention in yesterday's trading session when it led the decline. In the precious metals market, silver prices closed down nearly 2% to 37.79 USD/ounce, the deepest daily decline since early August. This development clearly reflects the reversal of investor sentiment when a series of macro factors have eroded the role of this precious metal as a haven.

The downward pressure on prices stemmed from the White House’s strategic move in relations with Beijing. US President Donald Trump signed an executive order extending the trade truce by 90 days, until early November. The market immediately interpreted this as a signal of reduced geopolitical risks, thereby weakening the demand for silver as a hedge. The possibility of a meeting between Trump and Chinese President Xi Jinping on the sidelines of the APEC Summit in late October further reinforced the positive sentiment and triggered a wave of capital movement away from safe-haven assets.

The second factor comes from the move to reassure the gold market. Mr. Trump affirmed that gold will not be taxed - a statement that erased the risk that the US Customs and Border Protection (CBP) had previously revealed. This information made gold become a cash flow attraction in the precious metal group, at the same time reducing the appeal of silver, which is often considered an "alternative choice" when gold is at risk.

The third factor was the recovery of the greenback. The DXY index rose 0.35% to 98.52, making silver priced in USD more expensive for holders of other currencies. The double whammy of less risk aversion and a stronger USD saw physical demand for silver fall sharply during the session.

Finally, the anticipation of the upcoming US inflation data (CPI) has kept the silver market from buying. Analysts forecast that the core CPI in July will increase by 0.3% compared to the previous month, while expectations that the Federal Reserve will cut interest rates by 25 basis points at its September meeting remain high at 85.9% according to the CME FedWatch tool. Investors are temporarily staying on the sidelines to assess the inflation picture and monetary policy, further reducing the momentum for silver to recover.

In the domestic market, silver prices on the morning of August 12 decreased by more than 1% compared to the previous session, down to 1,188,000-1,222,000 VND/tael in Hanoi and 1,190,000-1,228,000 VND/tael in Ho Chi Minh City, closely reflecting the movement of international prices.

Source: https://baochinhphu.vn/chi-so-mxv-index-co-phien-phuc-hoi-thu-4-lien-tiep-ca-phe-dan-dat-da-tang-10225081210241903.htm