Robusta coffee prices increased for three consecutive sessions amid a slight decline in the US dollar and a surge in gold.

Low inventories, Robusta coffee prices lead the increase Positive signals on supply, export coffee prices recover

At the end of the trading session on March 4, Arabica prices also recovered 1.96%, regaining what was lost in the previous session, while Robusta prices increased by 1.46%, marking the third consecutive increase. The continued strengthening of the Brazilian Real, combined with the gloomy coffee export activities in Honduras, helped Arabica prices regain momentum.

According to the Vietnam Commodity Exchange (MXV), prolonged hot weather in key coffee growing areas of Vietnam has increased market concerns about the risk of a decline in supply in the coming time.

Giá cà phê Robusta tăng ba phiên liên tiếp trong bối cảnh đồng USD giảm nhẹ và vàng tăng vọt

Arabica prices also recovered 1.96%, Robusta prices increased by 1.46%

The Real rose as Brazil’s IGP-Fipe inflation index for February maintained the previous month’s 0.46% increase. This led to a 0.17% decline in the USD/BRL exchange rate. The continued narrowing of the exchange rate differential has prompted many Brazilian farmers to limit their sales while buyers dominate the market.

In addition, according to the Honduran Coffee Institute (IHCAFE), the country's coffee exports in February increased by 26% compared to the same period last year due to many shipments being delayed since January. In addition, the cumulative coffee exports in the first 5 months of the 23/24 crop year of Honduras decreased by about 1% compared to the previous crop.

For Robusta, prolonged heat in Vietnam’s key coffee growing areas has raised concerns about a poor supply outlook. Furthermore, Robusta inventories on the ICE-EU exchange continued to fall by 600 tonnes in the session on March 3, bringing the total amount of coffee stored there to 23,590 tonnes.

In the domestic market, it was recorded this morning (March 5) that the price of green coffee beans in the Central Highlands and the Southern provinces increased by VND1,100/kg. Accordingly, domestic coffee is currently purchased at around VND86,200 - 87,100/kg.

Coffee prices have been breaking records in recent days, bringing joy to farmers. Currently, domestic coffee prices have nearly doubled compared to the same period last year. With this price, many coffee growers said that this year's crop is 2-4 times more profitable than rice farming.

The reason why coffee prices are continuously reaching new peaks is because the world's demand for Vietnamese Robusta coffee is very high. Along with that, the demand in the domestic market is also increasing strongly, so some green coffee products are used to roast and dissolve in water.

In the 2023 - 2024 crop year, our country's coffee output is expected to decrease to 1.6 - 1.7 million tons.

Meanwhile, in the 2023-2024 crop year, our country's coffee output is expected to decrease to 1.6 - 1.7 million tons, lower than the 1.78 million tons of the previous crop year. Notably, this year a large amount of coffee must compensate for the shortfall last year, thus leading to an earlier shortage, starting in February, while normally the supply does not run out until June.

According to coffee industry experts, farmers should consider choosing the right time to sell, because forecasting price movements in the current context is very difficult.

Especially now, the world's demand for Vietnamese Robusta coffee is very high, this is the reason why domestic coffee prices have increased compared to many years in history. Coffee farmers earn higher profits.

Regarding the continuous increase in coffee prices in recent times, experts say that part of the reason is due to supply, as output is estimated to have decreased by about 10%. Some households have switched to growing durian, so the area has decreased. Some businesses have imported more goods from other countries to ensure export supply, mainly FDI businesses.

Along with that, another reason for the increase in coffee prices is that some green coffee products are roasted and ground to make them soluble in water, so domestic demand increases.

Simexco Daklak General Director Le Duc Huy informed the press that it is estimated that the amount of coffee in the population is still very low, this situation is opposite to previous years. Normally, the supply will run out by June, but by the end of February, there are signs that the supply is almost exhausted.

Vietnam's General Statistics Office estimates that coffee exports in February reached only 160,000 tons, down nearly 20% compared to the same period last year, causing global consumption markets to worry about supply shortages, in the context of London floor inventories still hovering at low levels since 2014.

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