Inventories recover, coffee prices drop sharply
After reaching all-time high of over VND130,000 (US$5.1) per kg, domestic coffee prices have dropped sharply in recent days.
On May 6, coffee prices stood at about VND100,000 per kg, a fall of about VND30,000 per kg in less than a week.
The current price is around VND100,000 per kg in Central Highlands provinces, the coffee cultivation hub of Vietnam.
On the world market, coffee prices on both London and New York exchanges decreased sharply. A recovery in coffee inventories on the Intercontinental Exchange (ICE) has eased supply concerns and caused coffee prices to fall.
In the trading session on May 3, Arabica coffee for July delivery declined by 5.35 US cents per pound to US$200.75 per pound, while Robusta coffee fell by US$139 per tonne to US$3,541 per tonne – the lowest over the past month.
According to experts, domestic coffee prices have continued their sharp decline in recent days and reached their lowest level in the past month due to increased global coffee supply.
A coffee export business in the Central Highland province of Dak Lak said that a recent price hike is due to limited supply. When information on supply is more abundant, coffee prices will cool down.
In addition, rain in Vietnam's key coffee growing areas last week helped ease concerns about the next crop's output.
Businesses expect that the upcoming harvest season in Indonesia and Brazil will generate new supply, reducing pressure on coffee prices.
According to the Ministry of Agriculture and Rural Development, Vietnam exported 756,000 tonnes of coffee, earning nearly US$2.57 billion in the first four months of the year, up 5.4% in volume and 57.9% in value from the same period last year.
