Are domestic coffee prices "sliding"?

Coffee prices are forecast to fall on June 20, 2024 in the domestic market. Experts predict that coffee prices will likely fluctuate less strongly than in recent months, but will still remain high. The reason is that Brazil is in the peak harvest season. Then, in October, it will be the harvest season in Vietnam.

Recent weather forecasts show that there is a high probability of a La Nina phase occurring from August 2024, helping to improve water supply for farming activities.

In addition, tomorrow (local time) will be the expiration date of the July 2024 coffee options contract on the ICE Futures Europe exchange, so the trading market is limited and switched to trading of September 2024 coffee options contracts.

However, not only importers but also exporters are limiting transactions. Although it is the season, Brazil's export volume is slower than the average of many years, as people and exporters want to wait for better prices.

Notably, the latest data from the Center for Applied Economic Research (CEPEA, Brazil) shows that domestic coffee prices in Brazil have increased despite the country's main harvest season. Accordingly, domestic Robusta coffee prices in Brazil reached $3,762/ton at the beginning of this week and Arabica coffee reached $4,195/ton. The main reason is that international buyers continue to worry about unfavorable weather conditions in Vietnam - the world's largest producer of Robusta coffee.

Domestic coffee prices were updated at 4:30 a.m. on June 19, 2024 as follows, according to www.giacaphe.com, domestic coffee prices today are in the range of 120,000-121,000 VND/kg. Currently, the average purchase price in the Central Highlands provinces is 121,100 VND/kg, the highest purchase price in Dak Nong province is 121,200 VND/kg.

Specifically, the coffee purchase price in Gia Lai province (Chu Prong) is 121,000 VND, in Pleiku and La Grai the same price is 120,900 VND/kg; In Kon Tum province the price is 121,000 VND/kg; In Dak Nong province the coffee is purchased at the highest price of 121,200 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 120,000 VND/kg.

Coffee prices today (June 19) in Dak Lak province; in Cu M'gar district, coffee is purchased at about 121,000 VND/kg, and in Ea H'leo district, Buon Ho town, it is purchased at the same price of 120,900 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 4,185 USD/ton, up 77 USD compared to the beginning of the trading session. The delivery term for September 2024 was 4,024 USD/ton, up 30 USD; the delivery term for November 2024 was 3,869 USD/ton, up 17 USD and the delivery term for January 2025 was 3,702 USD/ton, down 2 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 19, 2024 decreased in all terms, fluctuating at 223.70 - 226.30 cents/lb.

Specifically, the July 2024 delivery period is 226.30 cents/lb; down 0.85t/lb compared to the beginning of the session. The September 2024 delivery period is 226.25 cents/lb, down 1.05 cents/lb; the December 2024 delivery period is 226.85 cents/lb, down 1.20 cents/lb and the March 2025 delivery period is 223.70 cents/lb, down 1.05 cents/lb.

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

The price of Brazilian Arabica coffee today at 20:30 on June 19, 2024 increased and decreased in opposite directions. Specifically, the delivery period for July 2024 is 283.90 USD/ton (down 1.10%); the delivery period for September 2024 is 277.00 USD/ton (up 0.50%); the delivery period for December 2024 is 274.30 USD/ton (up 1.10%) and the delivery period for March 2025 is 271.80 USD/ton (down 1.40%).

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 floor (New York floor) opens at 16:15 and closes at 01:30 (next day), Vietnam time.

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

Brazil’s coffee harvest is now progressing rapidly, taking advantage of dry weather and early-maturing Arabica beans. This is putting pressure on coffee futures exchanges.

Dry weather is expected to persist in most of Brazil’s coffee growing regions, especially in the south, the Cerrado and Matas regions of Minas Gerais state, over the next 10 days. Despite concerns about water stress on crops, current climatic conditions are considered favorable for coffee harvesting and drying.

The Vietnam Coffee and Cocoa Association (Vicofa) said that due to the impact of climate change and the El Nino phenomenon, coffee output has decreased. In Vietnam alone, in the 2023-2024 crop season, output will be about 10% lower.

Conflicts around the world, tensions in the Red Sea region, increased shipping costs and many other costs also pushed up coffee prices. In addition, many investors around the world began to choose coffee for speculation (after oil and gold), causing coffee prices to skyrocket.

Meanwhile, coffee inventories of production and processing enterprises from the previous crop are low, leading to a large difference in supply and demand.

Information for reference only. Prices may vary by location.

Source: https://congthuong.vn/du-bao-gia-ca-phe-ngay-2062024-gia-ca-phe-trong-nuoc-co-truot-doc-327048.html