The coffee market finds itself at a crucial juncture as Vietnamese domestic prices plummet to the lowest levels in over a year, fuelled by mounting global robusta supplies and waning demand. Beans in the Central Highlands, Vietnam’s coffee heartland, have tumbled to 103,000–103,500 dong (USD 3.94–3.96) per kg, down sharply from last week’s 111,500–112,000 dong range—and levels unseen since May 2023. Tensions reverberate on international markets as well: LIFFE robusta futures slid by $264 to $3,891 per ton, a one-year low, prompting many traders to hold back, anticipating further downside amid persistent macroeconomic and geopolitical uncertainties.
Despite this bearish price action, the underlying market fundamentals remain complex. Robusta output in Vietnam is buoyed by favorable rains and strong tree development—a positive note for the upcoming harvest. Meanwhile, Indonesia’s Sumatra robusta premiums have strengthened, quoted $150–$235 above the September London contract, as local sellers respond to London’s price drop and continue to tightly manage shipment schedules. Global consumption trends, robust inventory management, and external shocks like geopolitical events and adverse weather continue to drive volatility—and an air of caution—across the market.
📈 Prices
| Exchange/Region | Product | Closing Price | Weekly Change | Market Sentiment |
|---|---|---|---|---|
| London ICE (LIFFE) | Robusta Sep 2024 | 3,891 USD/ton | -6.3% | Bearish |
| New York ICE | Arabica Sep 2024 | 2.19 USD/lb | -3.6% | Bearish |
| Vietnam (Central Highlands) | Robusta (domestic, spot) | 103,250 VND/kg (3.95 USD/kg) | -7.8% | Bearish |
| Sumatra (Indonesia) | Robusta (prem. over LIFFE) | +150–235 USD/ton | +10–20 USD/ton | Firm |
Source: Local market reports, ICE, LIFFE, Bloomberg; exchange rates as of publishing
🌍 Supply & Demand Drivers
- Vietnam’s domestic prices: Fell to lowest in over a year amid weak global and local demand.
- Export volumes shrink: Vietnam’s Jan–Jul 2024 exports down ~14% y/y to 964,000 tons, though revenues up by 31% due to earlier high prices【6:0†full-posts-2024.json】.
- Robusta output outlook: Favorable rains in Vietnam’s Central Highlands improving yield potential for 2024/25.
- Indonesia premiums rise: Sumatran robusta now fetching $150–235/ton above London contracts as sellers price up against declining LIFFE futures.
- Global stocks: Still tight after a year of robusta-led price surges, but recent price corrections have prompted cautious trading.
- Speculative positioning: Large funds trimming long exposure as downside persists and macro risks grow.
📊 Fundamentals Snapshot
| Country | 2024 Output (estimate, 000 tons) | 2023/24 Export (000 tons) | Ending Stocks (000 tons) | Key Notes |
|---|---|---|---|---|
| Vietnam | 1,600 | 1,460 | 200 | Leading robusta; stocks low |
| Brazil | 3,890 | 2,800 | ~300 | Arabica under weather threat |
| Indonesia | 650 | 470 | 60 | Strong robusta premiums |
| World Total* | 10,950 | 11,200 | 1340 | Global supply draws |
*ICO/USDA/estimates, all figures rounded
🌦️ Weather Outlook: Vietnam & Indonesia
- Vietnam (Central Highlands): Seasonal rains continue, supporting tree growth; no major storm threats forecast this week.
- Indonesia (Sumatra): Stable weather with above-average humidity, helping cherry development and picking; no major disruptions reported.
- Brazil (watching): Some dryness threatening arabica flowering in Minas Gerais; risk to future supply if rains do not return soon.
🌐 Global Production & Stock Comparison
- Vietnam: World’s largest robusta exporter; 2024 harvest likely up but stocks remain tight until October.
- Indonesia: Sumatran robusta supply firm; high local premiums due to strong Asian demand.
- Brazil: Dry weather watching point for arabica supply; output was down 16% in 2023, supporting Vietnamese prices【6:11†full-posts-2025.json】.
📆 Trading Outlook & Recommendations
- For producers: Consider deferring spot sales if possible; prices are at cyclical lows and weather is favorable for upcoming crop yields.
- For buyers: Use current price dip to cover near-term needs, but expect volatility as markets watch Asia’s weather and global harvest signals.
- For traders: Volatility likely to persist with shifting speculative interest; short-term downside risks remain, but strong physical demand may trigger a rebound if global weather worsens.
🔮 3-Day Regional Price Forecast
| Region | Product | Current Price | Forecast (3 days) | Sentiment |
|---|---|---|---|---|
| Vietnam (Central Highlands) | Robusta (spot) | 3.95 USD/kg | 3.90–4.00 USD/kg | Weak, rangebound |
| London ICE | Robusta Sep 2024 | 3,891 USD/ton | 3,850–3,950 USD/ton | Cautious |
| Sumatra (Indonesia) | Robusta (premium) | +150–235 USD/ton | Premiums likely stable | Firm |
Summary: The coffee market is entering a period of correction and consolidation, shaped by renewed global supply from Asia and ongoing macro uncertainties. Downside pressure persists short-term, but watch for price recovery signals as harvests progress and global weather patterns unfold.
