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Asia Coffee-Trade dull on tight supply; steady rain in Vietnam supports cropFriday, July 21, 2017 > 10:34:41
Times of India
Tightening supply limited trade in Vietnam and Indonesia, Asia's main coffee exporters, although Vietnam's upcoming crop is expected to be solid on favourable weather, traders said on Thursday.
Steady rains in the Central Highlands, Vietnam's main coffee growing region, are providing enough water for the upcoming crop, with harvest season expected to start in late November or early December, traders said.
Local coffee prices in Vietnam, the world's largest robusta producer, rose to 45,500-46,100 dong ($2.0-$2.03) per kg , from 44,500-45,500 dong a week earlier, but was still lower compared with late last week when prices hit 46,600-47,000 dong, traders said.
The local prices reflect movements of the London ICE September contract, which rose to a one-week high on Friday before falling to close at $2,110 per tonne on Wednesday, Thomson Reuters data showed.
Vietnamese traders said importers asked for the 5-percent black and broken grade 2 robusta at discounts of $40-$50 per tonne to the September contract, but few deals were made as beans were scarce and demand was weak.
Traders expect coffee exports this month at 100,000-125,000 tonnes (1.67-2.08 million 60-kg bags). Vietnam exported 981,000 tonnes of coffee in the first half of 2017, up 18 percent from the same period last year, government data showed.
In Indonesia, Lampung traders said robusta was traded at $30-$40 discount to the September contract, narrower than the $50 discount a week earlier.
Trading was even lighter than last week, one of the traders said, as supply decreased.
"Supply is starting to tighten up since the harvest is ending. Stocks at farmers' warehouses are also starting to run out," the trader said. ($1 = 22,734 dong)