Weekly Product Updates

W46 Coffee Update: Fluctuations in Arabica Coffee Futures and Disrupted Harvesting in Vietnam

Raw Common Coffee Bean
Published Nov 26, 2023

Arabica Coffee Futures Fluctuated in W46

In W46 in the coffee landscape, Arabica coffee futures on the New York Stock Exchange (NYSE) fluctuated. On Monday, November 13, the contracts for Mar-24, May-24, Jul-24, and Sep-24 dropped 70 points to USD 169.85 cents per pound (lb), USD 169.90 cents/lb, USD 170.60 cents/lb, and USD 171.35 cents/lb, respectively, due to technical adjustments.

Prices decreased further on Tuesday, November 14, after Brazil's export data was released. However, on Wednesday, November 15, future prices rebounded, given the good performance of Brazilian exports in October. The contract for Dec-23 was quoted at USD 180.25 cents/lb with a 2.15% increase, Mar-24 contract was worth USD 173.75 cents/lb with a 1.37% rise, and May-24 was traded at USD 173.80 cents/lb with a 1.28% growth.

On Thursday, November 16, Arabica coffee's future prices declined sharply due to long liquidation pressures. Finally, on Friday, November 17, prices fell further, with the Mar-24 contract dropping 170 points, traded for USD 169.50 cents/lb, May-24 down 185 points, quoted at USD 169.45 cents/lb, Jul-24 dropping 180 points, traded at USD 170.25 cents/lb, and Sep-24 decreasing by 170 points, traded at USD 171.25 cents/lb.

Global Coffee Consumption Will be Driven by Asia

According to Euromonitor, the demand for coffee in Asia, Africa, and Latin America is expected to drive global coffee consumption in the coming years. In addition to the growing markets in these regions, the coffee industry may also expand into new categories, such as sports and energy drinks. On the other hand, the demand from traditional coffee consumers, such as in the US and Europe, is slowing down.

Vietnam's Coffee Harvesting Disrupted by Heavy Rains, Leading to Limited Supply and Increased Prices in W46

Heavy rains disrupted Vietnam’s coffee harvesting in key growing areas, which led to a limited supply of new crops and increased coffee prices in W46. Farmers in the central highlands, the largest coffee-growing region in Vietnam, were selling coffee beans at USD 2.41 to 2.45 per kilogram (kg), compared to USD 2.35 to 2.41/kg in W45. The farmers are holding back on coffee exports, anticipating better prices.

Moreover, Vietnam's coffee export volume for the 2022/23 season showed a 1.7% YoY decrease, with the total export volume reaching 1.7 million metric tons (mmt). The export value was reported to be USD 3.4 billion, with an average export price of USD 4,100 per metric ton (mt), showing an increase of 2.45% from the previous season. Most coffee exports were Robusta, accounting for 1.49 mmt and valued at USD 3.2 billion. Meanwhile, Arabica green coffee exports reached only 41.5 thousand, amounting to USD 169 million. Additionally, decaffeinated green coffee had a turnover of USD 136 million with an export volume of 36 thousand mt.

Lastly, according to the Vietnam Cocoa Coffee Association (VICOFA), Vietnam has released a list of the top 10 coffee exporters by volume for the 2022/23 season. The list is as follows: Intimex HCM, Vinh Hiep, Simexco Daklak, Intimex My Phuoc, Louis Dreyfus Vietnam, NKG Vietnam, Phuc Sinh, Tuan Loc Commodities, Central Highlands Commodity Trading and Olam Vietnam. Specifically, the top exporter is Intimex HCM Company, with an export volume of 148.5 thousand mt and an export value of USD 100 million. Vinh Hiep Co., Ltd is ranked second with an export volume of 120.5 thousand mt and an export value of USD 79 million. The third is Dak Lak 2-9 Dak Lak Import and Export Co., Ltd., which exported 75 thousand mt, valued at USD 219 million.

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