Coffee prices have risen more than 25% since the start of the year, after rising 70% last year. Could this surge lead to sharp increases in retail prices in the coming months and reduce demand?
Coffee price today 2/8/2025
World coffee prices ended this week with a sharp decline in Robusta, dragging Arabica down after a period of strong growth and many record prices. The recovery of the USD also contributed to the decline of coffee on both exchanges.
Domestic gold price today, February 8, is trading in the range of 128,500 - 129,500 VND/kg.
Robusta coffee prices fell for the second consecutive session due to pressure from sales from Vietnam after the Lunar New Year. In addition, domestic capital flows began to shift to pepper, as the price of this agricultural product also increased continuously after the holiday. In January 2025, Vietnam's coffee exports reached 154,635 tons, worth 799.48 million USD, down 33% in volume but up 28% in value compared to January 2024. Thanks to high export prices, the average reached 5,181 USD/ton in January 2025, much higher than the average of 4,178 USD/ton in 2024.
Arabica coffee futures for March 2025 rose 7% this week, after rising 8.7% last week. However, gains were limited in the final trading session of the week as the stronger US dollar put pressure on profit-taking in coffee futures.
Traders said the market was being weighed down by concerns about tight supplies from top producers Brazil and Vietnam, along with the risk that the Trump administration could impose trade tariffs on major coffee producers in South America.
Brazil's arabica coffee output is expected to fall this year as hot and dry weather in 2024 has contributed to tightening global supplies, prompting speculators to increase their long positions in arabica futures, Reuters reported.
Additionally, there is the threat that coffee may have to change shipping routes due to tariffs, which come amid an already struggling logistics industry.
However, high prices are starting to attract coffee stocks to ICE, with ICE data showing that the number of bags awaiting assessment has increased by 130,156 bags in the last five sessions.
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| Domestic coffee prices on February 7 adjusted up to 100 VND/kg in some key purchasing localities. (Source: aivivu) |
According to World & Vietnam , at the end of the trading session on February 7, the price of robusta coffee on the ICE Futures Europe London for delivery in March 2025 decreased by 72 USD, trading at 5,561 USD/ton. The delivery in May 2025 decreased by 72 USD, trading at 5,564 USD/ton. The average trading volume was low.
Arabica coffee prices on the ICE Futures US New York exchange, delivery term March 2025 increased by 0.4 cents, trading at 404.35 cents/lb. Meanwhile, delivery term May 2025 decreased by 0.4 cents, trading at 396.70 cents/lb. Trading volume is high.
Domestic coffee prices on February 7 were adjusted to 100 VND/kg in some key purchasing localities. Unit: VND/kg
(Source: giacaphe.com) |
The market is closely watching whether the recent rally in arabica coffee prices will lead to a drop in demand, traders said.
Bloomberg quoted Mr. Andrea Illy, Chairman of Italian coffee roaster Illycaffè SpA, as saying that the recent sharp increase in coffee prices could cause retail prices to increase by up to 25% in the next few months and reduce demand.
Asked whether retail prices could increase by 20-25% in the coming months, Mr. Illy said “it is possible.”
According to this veteran expert, this sharp price increase has affected demand in major markets and begun to restrain consumption growth in emerging economies.
He warned that soaring coffee prices could cause consumers to cut back on their coffee consumption. But the recent price surge is largely due to a lack of information about future supplies and short-term speculation, the Illycaffè SpA chairman said. Aside from the inventory in warehouses monitored by the exchange, he said it is unclear how much real supply is left in both producing countries and consuming markets. The market is still navigating this market in a state of uncertainty.
The price differential between arabica and robusta has widened recently as robusta has failed to keep up with the rise in arabica prices, Commerzbank said in a report. This again offers coffee consumers a cheaper alternative, potentially reducing the appeal of arabica.
Source: https://baoquocte.vn/gia-ca-phe-hom-nay-822025-gia-ca-phe-robusta-giam-manh-ngat-da-tang-12-phien-cua-arabica-kha-nang-gia-ban-le-se-tang-toi-25-303575.html
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