May Arabica coffee traded on Thursday closed up 5.70 cents on a fairly large volume of over 35 thousand lots and Robusta coffee closed up $66 per ton on a significant trading volume of 11,452. lot. lot.
Thus, Arabica has reached its highest level in the past 6 months and Robusta seems to be constantly moving towards the peak of 30 years ago. Concerns about the coffee crop in Brazil and also in Vietnam are supporting this market.
Perhaps from now on, the coffee world will remember Marex Group Plc as the unit that forecasts the global Robusta coffee deficit in 2024/25 to be 2.7 million bags due to production in Vietnam as well as global production. Demand tends to decline, while RaboBank forecasts a global output surplus during the same period.
Brazilian export group Comexim on February 1 raised its estimate of Brazil’s 2023/24 coffee export season to 44.9 million bags compared to the previous estimate of 41.5 million bags. However, larger coffee exports from Brazil as well as Vietnam seem to only create a more serious domestic inventory deficit.
Trade in the semi-processed Arabica coffee production sector in Central America is said to be progressing well as the coffee crop from October 2023 to September 2024 reached the halfway point at the end of March. With exports Accumulation in the first half of the coffee year is almost equal to the previous crop. Central America usually has small and stable output, so it does not have much impact on global prices.
Inventories of certified graded Arabica coffee held on the New York market are said to have increased by 10,630 bags yesterday, bringing the inventory to 632,500 bags.
Brazilian farmers have begun harvesting what is expected to be a larger Robusta crop this year as domestic coffee prices are at an all-time high and London Robusta futures hit a 16-year high via.
Brazil is the second largest producer of Robusta coffee after Vietnam and the leading producer of Arabica coffee. While Robusta is often bitter with a higher caffeine content, Arabica is milder and has a higher value.
Poor harvests in Vietnam, coupled with shipping disruptions in the Red Sea, have led to a spike in Robusta coffee prices and boosted demand for Brazilian Robusta coffees – or conilons as they are known in local – and European roasters are buying it instead.
Experts expect Robusta coffee production in Brazil to be larger in 2024. They say the harvest will start in April in some fields and will accelerate from May. Broker StoneX forecasts Brazil’s 2024 Robusta coffee production will be about 22.7 million bags compared to 21.5 million bags in 2023. There is not much inventory left from the 2023 crop.
Crop consultants say Brazil’s new crop of Robusta coffee will start hitting the market around June or July.
Domestic prices in the Central Highlands provinces of Vietnam this morning are getting closer to the mark of 110,000 VND/kg with detailed buying prices as follows:
Kinh Vu (Giacaphe.com)
