Asia Coffee-Vietnam domestic prices edge higher on global price recovery
Asia Coffee-Vietnam domestic prices edge higher on global price recovery
Vietnam's domestic coffee prices edged up on Thursday from a week earlier, tracking a recovery in Robusta futures on ICE as exporters halted shipments to Russia over payment and logistics problems related to the Ukraine conflict.
The London ICE May contract LRCc2 settled up $23 or 1% at $2,117 per tonne on Wednesday after having hit 6-month low last week.
Farmers in the Central Highlands, Vietnam's largest coffee-growing area, sold coffee COFVN-DAK at 39,200-41,300 dong ($1.72-$1.81) per kg, higher than 38,900-41,000 dong range last week.
Traders and exporters said most shipping companies had suspended delivery services to Russia, while Russia-based clients struggled to make payments and send documents and invoices via banks.
"We've halted all shipments to Russia and are in active talks to cancel some orders sealed with Russia-based clients before," said an exporter based in Ho Chi Minh City.
"Rouble is plummeting, shipping rates are rising, conflict is escalating, and our profit is nearing zero," the exporter said.
A trader based in the coffee belt also raised concerns over rising fertilizer prices resulting from sanctions on Russia.
"The pandemic has pushed fertilizer prices to 2-2.5 times higher, now with tightening supplies, production cost will keep mounting."
Traders in Vietnam offered 5% black and broken-grade 2 robusta COFVN-G25-SAI at a discount of $300 per tonne to the July contract, compared with last week's $325 discount.
In Indonesia's Lampung province, one trader offered $200 discount to the March contract, unchanged from two weeks ago.
Another trader said beans were offered at $100-$110 discount to the April to May contracts, compared with $170 discount to the March to April contracts before holiday.
"We may have a mini harvest this April, so those who still have remaining beans are releasing old stocks," one of the traders said.
