Coffee Prices Are At Their Highest In History: In the early days of January, the price of green coffee in the Central Highlands continued to increase and is at the highest level ever.
Information from coffee industry traders shows that green coffee prices in the Central Highlands continuously tend to increase in the first half of January 2023. Right on the first day of the new year, the price of green coffee was at a very high level, around 68,000 VND/kg. By January 16, the price of green coffee in the Central Highlands had exceeded 71,000 VND/kg. The current price is said to be the highest in the history of the Vietnamese coffee industry.
Coffee prices increased to record levels in the first days of the year, with a significant impact from tensions in the Red Sea region. The blockage of shipping routes through the Suez Canal is causing concerns about a shortage of Robusta coffee supplies from Asia.
The decline in coffee exports from Vietnam is also contributing to concerns about the risk of Robusta coffee shortage. Information from the General Department of Vietnam Customs shows that in the first 3 months of the 2023/2024 crop year (from October 2023 to September 2024), Vietnam exported 370,635 tons of coffee, down to 9,000 tons. 87% compared to the same period in the 2022/2023 crop year.
Mr. Do Ha Nam, Vice Chairman of the Vietnam Coffee and Cocoa Association (Vicofa), said that compared to the previous crop year, in the 2023/2024 crop year, it is estimated that Vietnamese coffee output will decrease by 5 – 10%. , reaching about 1.6 – 1.7 million tons.
Adverse weather in India – a Robusta coffee producing country, is also affecting coffee prices. High levels of unseasonal rainfall in Kamataka and Kerala are alarming the risk of coffee crop failure in India. India is one of the 10 largest coffee producing countries in the world and ranks 4th among Robusta coffee producing countries (after Vietnam, Brazil and Indonesia), with an output of over 300 thousand tons. Therefore, the loss of coffee crop in India also has more or less an impact on global Robusta coffee prices.
According to a report by the ICE Report Center, on January 15, Robusta inventories decreased by 1,170 tons, or 8.92% compared to the end of last week, down to 31,940 tons. This is a new record low since early September 2023.
The above factors are pushing Robusta coffee prices higher on the world market. During the trading session on January 15 on the London floor, the price of Robusta coffee delivered in March 2024 sometimes approached the mark of 3,000 USD/ton when reaching 2,998 USD/ton.
The fact that farmers store coffee and are not in a hurry to sell it also contributes significantly to increasing coffee prices. In the 2022/2023 crop year, when the price of green coffee beans increased to over 50,000 VND/kg – a price considered a “dream” for coffee growers, most Vietnamese coffee farmers massively sold out. coffee. Therefore, when coffee prices rose to over 60,000 and peaked at 70,000 VND/kg, farmers received almost nothing more from these prices.
But in the 2023/2024 crop year, when green coffee prices are always high, from over 60,000 to over 70,000 VND/kg, many coffee farmers in the Central Highlands are still keeping coffee at home. If they need to sell to spend during the upcoming Lunar New Year, many farmers will only sell a portion of their coffee without selling all of it, even though the current price has brought very attractive profits to coffee growers.
