World coffee prices fluctuated strongly, robusta continued to increase strongly, leading arabica to recover. Domestic coffee prices have increased continuously since the beginning of the week. Positive data helped both coffee derivatives exchanges increase strongly in the last session.
Vietnam Customs reported that coffee exports in the first half of August reached 37,410 tons (about 623,500 bags), bringing coffee exports in the first 7.5 months of the year to a total of 1,154,214 tons, down 2.61% over the same period last year.
Information about continued low inventories pushed coffee prices up. As of August 22, robusta coffee inventories had decreased by another 40 tons compared to the beginning of the week, down to 36,110 tons (about 601,833 bags, 60 kg bags).
Meanwhile, the weakening of the US dollar and the recovery of the Brazilian Real are factors pushing up coffee prices on the New York floor.
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| Domestic coffee prices today, August 23, increased by 500 VND/kg in key purchasing localities. (Source: ohman.vn) |
At the end of the trading session on August 23 on the international futures exchange, the price of robusta coffee on the ICE Futures Europe London exchange for September 2023 delivery increased by 55 USD, trading at 2,628 USD/ton. The August delivery period increased by 28 USD, trading at 2,402 USD/ton. Average trading volume.
Arabica coffee prices on the ICE Futures US New York exchange for September 2023 delivery increased by 3.85 cents, trading at 153.9 cents/lb. Meanwhile, the December 2023 delivery increased by 3.55 cents, trading at 155.1 cents/lb. Trading volume is high on average.
Domestic coffee prices today, August 23, increased by 500 VND/kg in key purchasing localities.
Unit: VND/kg. (Source: Giacaphe.com) |
The dollar fell against other currencies in the last trading session, after data showed US business activity slowed in August, with growth at its weakest since February.
Demand has exceeded supply over the past two years due to adverse weather and El Nino, causing robusta coffee prices to reach a 15-year high in May 2023. The results of a recent Reuters survey continue to have a positive impact on the market.
According to experts' analysis, concerns about coffee supply in Vietnam are not only at present with the problem of nearly depleted inventories, but also in the future, the supply outlook is not very positive in the 2023/2024 crop year.
The United States Department of Agriculture (USDA) has forecast that Vietnam's coffee exports in the upcoming crop year will be only 27.5 million 60kg bags, the lowest level in the last 3 crop years. Along with that, the El Nino phenomenon has appeared and will negatively affect the coffee crop in leading Asian producing countries, especially Vietnam, making the recovery of coffee supply here still a big challenge.
Along with Vietnam’s supply, the world’s two other leading coffee exporters, Brazil and Indonesia, have both shown less positive signs regarding coffee supply in the 2023/24 crop year. USDA even forecasts that Indonesia’s coffee output in the 2023/24 crop year will be only around 9.7 million bags, down to its lowest level in 12 years.
If the above forecasts are correct, the outlook for Vietnam's coffee prices in the second half of this year still has a lot of room for growth.
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