Domestic coffee prices fell sharply after 4 consecutive weeks of increase?

Coffee prices are forecast to cool down on June 17, 2024 in the domestic market, falling sharply after 4 consecutive weeks of increase. This week's decline in coffee prices was a predictable result after the previous strong increase. Despite unfavorable technical indicators, coffee prices have increased sharply in recent times.

Coffee prices plummeted at the end of the week, not without negative information about the world political situation. In particular, the USD exchange rate rose to a nearly 7-week high, making coffee less attractive. Currently, the DXY index measuring the greenback's fluctuations against 6 major currencies (EUR, JPY, GBP, CAD, SEK, CHF) has increased to 105.52. The USD is holding high as traders bet that the Fed will only cut interest rates once this year.

In addition, according to experts, coffee prices are also under pressure because the harvest in Brazil is progressing smoothly and faster.

With the forecast that Robusta supply from Vietnam will continue to be scarce in the coming time, hedge funds have increased their net buying position. According to Volcafe, Vietnam's Robusta output in the 2024/25 crop year is estimated at 24 million bags - the lowest in 13 years, due to unfavorable weather conditions.

Domestic coffee prices were updated at 4:30 a.m. on June 16, 2024 as follows, according to www.giacaphe.com, domestic coffee prices today turned down slightly to between 119,000-120,200 VND/kg. Currently, the average purchase price in the Central Highlands provinces is 120,100 VND/kg, the highest purchase price in Dak Nong province is 120,200 VND/kg.

Specifically, the coffee purchase price in Gia Lai province (Chu Prong) is 120,000 VND, in Pleiku and La Grai the price is 119,900 VND/kg. In Kon Tum province, the price is 120,000 VND/kg; In Dak Nong province, coffee is purchased at the highest price of 120,200 VND/kg.

The price of green coffee beans (coffee beans, fresh coffee beans) in Lam Dong province in districts such as Bao Loc, Di Linh, Lam Ha, coffee is purchased at 119,000 VND/kg.

Coffee prices today (June 16) in Dak Lak province; in Cu M'gar district, coffee is purchased at about 120,000 VND/kg, and in Ea H'leo district, Buon Ho town, it is purchased at the same price of 119,900 VND/kg.

London Robusta coffee price (Photo: Screenshot giacaphe.com)

Specifically, the price of Robusta coffee futures contract for July 2024 delivery on the London floor was at 4,115 USD/ton, down 106 USD compared to the beginning of the trading session. The delivery term for September 2024 was 4,009 USD/ton, down 84 USD; the delivery term for November 2024 was 3,867 USD/ton, down 67 USD and the delivery term for January 2025 was 3,713 USD/ton, down 47 USD.

New York Arabica coffee price (Photo: Screenshot giacaphe.com)

Similarly, the price of Arabica coffee on the New York floor today at 20:30 on June 15, 2024 decreased in all terms, fluctuating at 221.95 - 224.15 cents/lb.

Specifically, the July 2024 delivery period is 224.15 cents/lb; down 1.90 cents/lb compared to the beginning of the session. The September 2024 delivery period is 224.40 cents/lb, down 1.85 cents/lb; the December 2024 delivery period is 223.20 cents/lb, down 1.80 cents/lb and the March 2025 delivery period is 221.95 cents/lb, down 1.60 cents/lb.

Brazilian Arabica coffee prices (Photo: Screenshot giacaphe.com)

The price of Brazilian Arabica coffee decreased slightly on the morning of June 16, 2024. Specifically, the delivery period for July 2024 is 281.05 USD/ton (down 2.50%); the delivery period for September 2024 is 275.90 USD/ton (up 0.15%); the delivery period for December 2024 is 270.20 USD/ton (down 2.95%) and the delivery period for March 2025 is 269.50 USD/ton (down 2.10%).

Robusta coffee traded on the ICE Futures Europe (London exchange) opens at 16:00 and closes at 00:30 (next day), Vietnam time.

Arabica coffee on the ICE Futures US (New York floor) opens at 16:15 and closes at 01:30 (next day), Vietnam time.

For Arabica coffee traded on the B3 Brazil exchange, it will be open from 19:00 - 02:35 (next day), Vietnam time.

Currently, a favorable crop in Brazil, increasing inventories on the floor, and speculative overbuying on the floor are factors holding back the growth of coffee.

On the other hand, rising coffee demand and freight rates, along with concerns about a decline in Vietnam's upcoming coffee harvest, are factors supporting the uptrend.

According to the report of the International Coffee Organization (ICO), in the Asia and Oceania region, in April, the region's coffee exports continued to decrease by 0.3% to 3.8 million bags.

Once again, the regional trend was set by Vietnam, the largest coffee producer and exporter in Asia and Oceania, which recorded a 6.9% decline in exports in April. This means Vietnam’s coffee exports have fallen in five of the first seven months of the 2023-24 crop year, marking the country’s third consecutive monthly decline.

The ICO explained that Vietnam’s exports are down due to high volumes in the 2022-23 coffee crop year and a year outside the biennial production cycle. However, April’s exports are still lower than the average of 2.8 million bags in the same period over the past three years.

Information for reference only. Prices may vary by location.

Source: https://congthuong.vn/du-bao-gia-ca-phe-ngay-1762024-ca-phe-trong-nuoc-giam-manh-sau-4-tuan-tang-lien-tuc-326509.html