Domestic coffee prices continue to "break the peak", will robusta still be supported in the short term?

Since the beginning of 2024, domestic and world coffee prices have continuously set new peaks. At the end of last week's session, each kilogram of green coffee beans surged to VND80,100, an increase of VND1,400 compared to the previous day. This is a record high ever.

World coffee prices fluctuated strongly last week as the balancing and adjustment of speculative positions before the first announcement date recently (the first announcement date FND - in New York is February 21 and in London is February 26).

Domestic coffee prices continued to increase sharply in the last sessions of the week, the highest recorded domestic transaction price in Dak Nong was 81,400 VND/kg.

Last week, Robusta coffee prices had 3 sessions of decline at the beginning of the week and 2 consecutive sessions of increase at the end of the week, the declines were very significant. Robusta coffee futures for March delivery decreased by a total of 118 USD (3.52%), down to 3,231 USD/ton; futures for May delivery decreased by a total of 76 USD (2.36%), down to 3,141 USD/ton. Trading volume was above average .

Arabica coffee prices on the New York floor had 3 sessions of decline at the beginning of the week and 2 sessions of increase at the end of the week, the declines were very significant. Arabica coffee futures for March delivery decreased by 5.45 cents (2.78%) to 190.85 cents/lb and futures for May delivery decreased by 4.80 cents (2.51%) to 186.70 cents/lb. Trading volume was above average.

Low inventories and less-than-expected selling pressure from Vietnam after the Lunar New Year helped robusta rise sharply. In the context of a global robusta supply shortage, supply is still constrained and there is still price resistance in the domestic market of many major producing countries, terrorist attacks on shipping routes through the Red Sea also contributed to the increase in demand for Brazilian Conilon robusta.

Robusta coffee inventories certified and monitored by the London Exchange, as of February 16, decreased by 5,050 tons, or 20.09% compared to the previous week, to a new record low of 20,090 tons (about 334,833 bags, 60 kg bags), which will continue to support robusta coffee prices in the short term.

Giá cà phê hôm nay 17/11: (Nguồn: Coffeeam)

Domestic coffee prices on February 18 increased by 800 - 900 VND/kg in some key purchasing localities. (Source: Coffeeam)

According to TG&VN, at the end of last week's trading session (February 16), the price of robusta coffee on the ICE Futures Europe London exchange continued to increase, with the delivery date for March 2024 increasing by 26 USD, trading at 3,231 USD/ton. The delivery date for May 2024 increased by 33 USD, trading at 3,141 USD/ton. Trading volume was low.

Arabica coffee prices on the ICE Futures US New York exchange increased, with the March 2024 delivery period increasing by 1.55 cents, trading at 190.85 cents/lb. Meanwhile, the May 2024 delivery period increased by 1.55 cents, trading at 186.70 cents/lb. Average trading volume.

Domestic coffee prices on February 18 increased by 800 - 900 VND/kg in some key purchasing localities.

Average price	Medium
USD/VND exchange rate	24,310	+ 70
DAK LAK	81,100	+900
LAM DONG79	80,300	+800
GIA LAI	81,000	+900
DAK NONG	81,400	+800

Unit: VND/kg.

(Source: Giacaphe.com)

Green coffee beans have been a commodity that has "hit the top" continuously for the past 6 months. Although the London exchange has dropped sharply, domestic coffee prices have remained essentially stable over the past week, even increasing sharply in the last 2 days, pushing the price above 80,000 VND/kg.

According to experts from the Vietnam Coffee and Cocoa Association (VICOFA), importers around the world are looking to Vietnam to buy coffee. In 2023, businesses almost "emptied" their warehouses for export. This is also the first time in history that by June 2023, people had no coffee to sell. Currently, the inventory of this commodity has decreased sharply, combined with a number of other factors in the market, which is the reason why coffee prices continuously reach new peaks.

The report of the Ministry of Agriculture and Rural Development forecasts that commodity prices will have many changes this year. In January, prices of most commodities tend to increase compared to November 2023. Of which, coffee increased by 4-9%, regular rice by over 6%, mango by 8%, raw shrimp (4%), raw fish (5-6.7%)...

The Ministry of Industry and Trade has set a target growth rate of 3.2-4.0% for the entire industry; total export turnover of agricultural, forestry and fishery products is 54-55 billion USD. Of which, key agricultural products such as rice, coffee, and durian will continue to grow this year.

Source