VINAGRI News - Vietnam’s domestic coffee prices fell sharply by VND 4,000/kg on April 8, tracking a steep decline in London robusta futures as rising global supply expectations weigh on the market.
Summary:
> Vietnam domestic coffee prices fell by VND 4,000/kg to VND 84,600 - 85,300/kg
> London robusta futures dropped sharply, with May 2026 down 3.86%
> Domestic prices remain slightly above July 2026 futures by about VND 200/kg
> Market pressured by expectations of strong global supply from Brazil and Vietnam
> Short-term outlook remains bearish, with possible technical rebounds limiting losses
Vietnam’s domestic coffee prices recorded a significant decline on the morning of April 8, falling by VND 4,000/kg to a range of VND 84,600 - 85,300/kg across the Central Highlands.
On the international market, robusta coffee futures continued their downward trajectory. At the close of trading on Tuesday (April 7), the May 2026 robusta contract on the ICE London exchange dropped sharply by 3.86% (down USD 133/ton) to USD 3,315/ton. Other contracts also posted notable losses, with the July 2026 contract falling 3.44% (down USD 115/ton) to USD 3,231/ton, and the September 2026 contract declining 3.77% (down USD 124/ton) to USD 3,161/ton.
Converted into Vietnamese dong, the July 2026 robusta futures price is currently equivalent to approximately VND 85,000/kg, based on an exchange rate of USD 1 = VND 26,328.50.
With an average domestic price of VND 85,200/kg, Vietnam’s robusta coffee is currently trading at a premium of about VND 200/kg (equivalent to roughly USD 7.60/ton) compared to the July 2026 London futures contract.
The coffee market is expected to remain cautious in the April 8 session following the previous sharp decline, driven primarily by concerns over a significant increase in global supply, particularly from Brazil and Vietnam.
For robusta, the July 2026 contract on ICE London is likely to continue fluctuating with a weakening bias. The main pressure stems from forecasts of record production in Brazil for the 2026/27 crop year, along with expectations of a global surplus of around 10 million bags. Additionally, ample supply from Vietnam, supported by rising output and exports, continues to weigh on prices.
However, after a prolonged two-week decline, the market may see technical buying interest emerge, potentially limiting further downside. Supportive factors include low robusta inventories on ICE, rising freight costs due to disruptions in the Strait of Hormuz, and localized dry weather conditions in Brazil.
Under the base-case scenario, the July 2026 robusta contract is projected to trade within the range of USD 3,180 - 3,260/ton, with a slight downward or sideways trend prevailing. In the event of stronger technical buying, prices could recover toward USD 3,280 - 3,320/ton. Conversely, if selling pressure intensifies, prices may test deeper support levels around USD 3,150/ton.
Overall, the short-term outlook for the coffee market remains bearish due to fundamental factors, although price movements in the upcoming session are expected to be choppy, with intermittent technical corrections.
NPK/ Vinagri News
No comments:
Post a Comment