Asia Coffee-Indonesia trading increases, demand slows in Vietnam

© Reuters. Asia Coffee-Indonesia trading increases, demand slows in Vietnam

* Vietnam’s discount at $50-$60/T to May contract

* Indonesian premium at $140/T for five weeks straight

By Mai Nguyen

HANOI, March 22 (Reuters) – An upcoming mini harvest boosted trading in Indonesia coffee but slowed down demand for the beans in regional rival Vietnam, traders said on Thursday.

Indonesia coffee trading this week has been increasing and is expected to be even more robust next month when its mini harvest season peaks, a trader said.

The grade 4 defect 80 robusta COFID-G4-USD in Lampung province, Indonesia’s main coffee growing region, was steady at a $140 a tonne premium to London’s May contract LRCc3 , the trader said.

“The volume will be better than last year, but our concern now is whether there’s still a lot of rain. Too much rain will disturb the quality,” said Moelyono Susilo, a trader at PT Taman Delta Indonesia.

Susilo expects Indonesia’s 2018 total coffee output to increase to around 11 to 11.5 million 60-kg bags, from 9.5 million bags in 2017.

In rival Vietnam, the world’s top robusta producer, farmers quoted beans COFVN-DAK at 37,500 dong ($1.65) a kilogram in Dak Lak province, the country’s main coffee growing region, compared to 37,400-37,700 dong a week earlier, traders said.

Vietnamese traders quoted the 5 percent black and broken grade 2 robusta COFVN-G25-SAI at a discount of $50-$60 per tonne to the ICE May futures contract, stretching slightly from $40-$50 last week.

But Vietnamese traders said the market has been slow as buyers eye harvests in Indonesia and Brazil, the world’s top coffee producer. ($1 = 22,794 dong)

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