May Arabica coffee traded on Wednesday closed up 1.10 cents/pound and Robusta coffee closed up $49.
Coffee prices on Wednesday escaped downward pressure at the start of the session to close higher in both markets, on concerns about coffee crops in Brazil and Vietnam.
Information from Vietnam Customs about the country’s 17% increase in export volume in March was not enough to cool down the price increase of this type of coffee, because concerns about excessive drought in Vietnam have not been improved thanks to the first rains of the season in some areas.
Coffee price details today April 11, 2024
Arabica coffee hit its highest level in nearly six months on weather concerns in Brazil, with Somar Meteorologia reporting on Monday that Brazil’s Minas Gerais region had received rainfall over the past week. is too low, only 2.5 mm, equivalent to 12% of the historical average.
The association of coffee exporters in Brazil, Cecafé, also reported that cumulative exports of green coffee in the first nine months of the year were overall 29.48% higher compared to the same period last year, the previous coffee year, with a remarkable total of 32.31 million bags.
Inventories of certified graded Arabica coffee held in the Arabica coffee market are said to have increased by 6,308 bags yesterday, bringing the inventory to 621,870 bags.
According to the opinions of some technical analysts, Arabica coffee prices have many doors to increase in the near future.
Arabica prices this week have increased parabolically, joining the rise in Robusta prices that have reached record highs.
Arabica rose to a high of $215 on Monday, its highest since October 2022, and has surged more than 50% from its 2023 low, data showed.
Robusta, on the other hand, has soared to a precarious 30-year high of $3,825, well above its pandemic low of $1,026. This price action means these soft commodities are outperforming other traditional assets, including stocks.
The main reason why Arabica and Robusta coffee prices are skyrocketing is because the industry is facing supply challenges at a time when demand is increasing worldwide.
Coffee supply growth is slowing around the world as farmers turn to other profitable crops and businesses. In Kenya, many farmers have chosen to subdivide their land to carry out real estate projects.
Several coffee-producing countries are witnessing weather-related events. For example, Vietnam is experiencing a major heat wave that is greatly affecting crop production.
The spike in Arabica coffee prices is also a response to Robusta coffee, which has increased sharply in the past few months.
After predicting a target of 215 cents that the market aimed for and reached on Monday, some analysts now believe that Arabica’s next target is likely to be 240 cents, a level of fluctuation that has occurred before. released in June 2022.
We still have time to contemplate this while waiting for the latest crop from two famous coffee producing countries, Indonesia and Brazil.
Kinh Vu (giacaphe.com)
