VINAGRI News - Vietnam’s domestic coffee prices fell sharply on December 29, widening the discount to ICE London robusta futures, while global coffee markets prepared to reopen after the Christmas holiday amid persistent supply concerns.
Summary:
> Vietnam coffee prices fell VND 1,500 - 2,000/kg on Dec 29, widening the gap with ICE London futures
> Domestic robusta trades at a USD 190/tonne discount to March 2026 London contracts
> Global coffee markets reopen after the holiday with robusta prices holding near multi-month highs
> Indonesia flooding and low ICE inventories support prices, while Vietnam’s supply outlook limits upside
Vietnam’s domestic coffee market recorded a sharp decline on Monday (December 29), with prices in the Central Highlands dropping by VND 1,500 - 2,000 per kilogram, settling in the range of VND 95,000 - 96,600/kg. The correction came despite robusta futures on the ICE London exchange remaining at elevated levels ahead of the new trading week.
Global coffee exchanges, including ICE New York (arabica) and ICE London (robusta), are scheduled to reopen for the first trading session of the week at around 16:00 local time (GMT+7), following the extended Christmas holiday.
In the most recent completed session, robusta futures for March 2026 delivery on ICE London closed at USD 3,858 per tonne on Wednesday (December 24). Meanwhile, arabica futures for March 2026 on ICE New York ended the December 26 session at 350.25 US cents per pound, equivalent to approximately USD 7,721 per tonne.
Converted at the current exchange rate of USD 1 = VND 26,289, March 2026 robusta futures are valued at around VND 101,400/kg. By comparison, the average domestic robusta price of VND 96,400/kg is currently trading at a discount of about VND 5,000/kg, or roughly USD 190 per tonne, relative to London futures.
Looking ahead, robusta prices on ICE London are expected to remain elevated during the December 29 session as trading resumes. Ongoing flooding in Indonesia continues to raise concerns over export disruptions in the 2025 - 2026 season. As the world’s third-largest robusta producer, Indonesia’s supply risks remain a key supportive factor for prices. In addition, ICE-monitored robusta inventories, although showing a modest recovery recently, remain well below long-term averages, limiting downside risk.
However, medium-term supply pressure persists as global robusta production prospects improve, particularly in Vietnam - the world’s largest robusta producer. Forecasts indicate higher output in the 2025 - 2026 season, while exports have remained strong toward year-end, tempering expectations of a sustained price rally.
Under these conditions, March 2026 robusta futures are expected to trade within a narrow range of USD 3,830 - 3,920 per tonne, with prices likely to hover around USD 3,860 - 3,900 per tonne amid ongoing tug-of-war between buying and selling forces.
Overall, robusta prices are expected to stay firm in the short term, supported by supply risks and low inventories, though further gains will largely depend on weather developments and fresh signals from global export markets.
NPK/ Vinagri News
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