In the derivatives market, according to the Vietnam Commodity Exchange MXV, at the end of the trading session on August 26, the price of Arabica coffee increased by 0.95% to 5,503.83 USD/ton, the highest level in two and a half years, continuing the upward trend from the end of last week.
Concerns about dry weather in Brazil and a shrinking global coffee surplus are the main factors supporting prices. In Brazil, the drought in the Southeast, the country’s main coffee growing region, is expected to last until mid-September. This could adversely affect the coffee trees that are flowering for the 2025-2026 harvest, which could push supplies down.
In addition, many exporters and analysts in a Reuters survey said that coffee supplies could tighten in the 2024-25 crop year, with production exceeding demand by only about 150,000 bags, down from an estimated surplus of 750,000 bags in the 2023-24 crop year. With the production surplus shrinking, respondents forecast Arabica coffee prices to rise to $5.90 per kilogram by the end of the year, up 10 cents from the closing price on August 26.
Illustration photo – Photo: Investment Newspaper.
Robusta coffee prices are also hovering at record highs amid concerns about supply shortages in Vietnam. In the domestic market, this morning (August 27), the price of green coffee beans in the Central Highlands and the Southern provinces was around VND119,200 – 120,200/kg, up VND200-400/kg compared to last weekend.
Specifically, today’s coffee price in Dak Lak is trading at 112,000 VND/kg, up 200 VND/kg compared to the previous trading session. Today’s coffee price in Lam Dong is trading at 119,200 VND/kg, up 200 VND/kg compared to yesterday. Today’s coffee price in Gia Lai is trading at 112,000 VND/kg, up 200 VND/kg compared to a day ago. Today’s coffee price in Dak Nong has the strongest increase, trading at 120,200 VND/kg, up 400 VND/kg.
Robusta coffee futures on the London Commodity Exchange have now surpassed their all-time high, trading above $5,100 a tonne.
According to experts, a number of reasons such as bad weather, disrupted transportation activities as well as a tightened legal environment in many countries will cause world coffee prices to fluctuate strongly from now until the end of 2024.
Some forecasts suggest that in the long term, coffee prices will continue to increase due to climate change and many other factors, although they may cool down in early 2025.
In Vietnam, the coffee industry is an important agricultural sector, especially for the production and export of Robusta coffee. With favorable climate and soil conditions, Vietnam has become the second largest coffee producer in the world. Vietnam exports large volumes of green coffee beans, mainly to major coffee consuming countries such as the United States, Germany and Italy.
