VINAGRI News - Robusta coffee futures on the London exchange surged sharply on October 3, but domestic prices in Vietnam rose more modestly, remaining around USD 98.54/ton lower than international levels. The gap reflects differences in trading terms, quality standards, and local supply-demand conditions.
Summary
> London Robusta futures surged 4.74% to USD 4,527/ton (Nov 2025 contract).
> Domestic prices in Vietnam rose slightly to VND 116,700 - 117,100/kg, still USD 98.54/ton lower than global futures.
> Gap reflects logistics costs, quality discounts, exchange rate impacts, and weak local demand.
> New harvest pressure also weighs on domestic prices as farmers begin selling early.
At the close of trading on October 3, Robusta coffee futures for November 2025 delivery on the London ICE exchange soared by 4.74% (+USD 205) to USD 4,527/ton. The January 2026 contract also jumped 4.55% (+USD 197) to USD 4,522/ton.
Converted into local currency, the November 2025 contract price equals approximately VND 119,500/kg.
In Vietnam’s Central Highlands, the key coffee-growing region, domestic Robusta prices on October 4 climbed by VND 1,500 - 2,000/kg, reaching VND 116,700 - 117,100/kg. Based on the average price of VND 116,900/kg, local coffee remains VND 2,600/kg (equivalent to USD 98.54/ton) lower than the November 2025 London futures price, given the current exchange rate of VND 26,385.02/USD.
Despite the sharp rally on the London exchange, domestic prices in Vietnam increased at a slower pace, signaling that actual local prices continue to trail international benchmark levels. Several factors contribute to this gap:
1. Different pricing terms: London futures reflect FOB (Free on Board) export prices, while domestic prices are based on farm-gate or warehouse levels, excluding transport, insurance, packaging, and export fees.
2. Quality adjustments: If local beans do not meet export-grade standards (e.g., moisture, defect ratio, impurities), buyers apply price discounts.
3. Currency fluctuations: Changes in the USD/VND exchange rate and interest rates affect domestic price conversions.
4. Market dynamics: When local supply is abundant or domestic demand is weak, internal prices tend to lag behind international benchmarks.
Local traders are closely tracking the London and New York exchanges to guide buying and selling decisions. While stronger global prices usually exert upward pressure on domestic markets, local adjustments remain limited when costs, quality, or demand do not support significant increases.
With the new harvest season now underway, many farmers are starting to sell, creating downward pressure on domestic prices. Dealers, cautious about potential price declines during peak harvest, are reluctant to stockpile large volumes, keeping market sentiment subdued despite global gains.
NPK/ Vinagri News
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