Vietnam coffee prices fell last week amid weakness in global robusta, as local farmers continued to face water shortage, while Indonesia witnessed supply build up and muted trade.
Drought has hit 300 hectares of crops, mostly coffee trees, in Dak Lak province in the Central Highlands, Vietnam’s largest coffee growing area, local officials said.
“The situation of drought is forecast to get worse towards the end of March and early April,” Mai Trong Dung, head of the province’s agriculture department, told local media.
Farmers in the Central Highlands sold coffee at 31,900- 33,700 dong ($1.38-$1.45) per kg COFVN-DAK on Friday, down from a range of 33,700-34,000 dong last week.
Traders in Vietnam are complaining they are making losses on fixed contracts as prices have been falling over the past week, and they are also having a hard time securing the beans as farmers refrain from selling due to low domestic prices.
Traders in Vietnam offered 5 percent black and broken grade 2 robusta COFVN-G25-SAI at a $50 per tonne discount to the May contract, compared with $50-$70 last week.
Another traders in the province said premiums were $169-$170.
Meanwhile, May robusta coffee settled down $28, or 1.8 percent, at $1,490 per tonne. ($1 = 23,198 dong) (Reporting by Khanh Vu and Mas Alina Arifin; Editing by Rashmi Aich)