On Thursday, coffee prices were boosted as significant watchers reported tighter inventories for robusta and arabica.
Coffee futures’ price for May delivery rose by 2.11% to $190.23 per 37,500 lbs.
May Arabica posted a 2-1/4-month gain. Additionally, robusta reported a contract high as its nearest futures (H24) hit a new record high.
One of the drivers for rising prices is the below-average rainfall in Brazil’s coffee-growing areas. According to experts, the country’s Minas Gerais region only received 29.4 mm of rainfall the previous week.
Also, a stronger Brazilian real boosted the beans’ costs as they climbed to a week high against the USD. As a result, the currency’s spike discouraged export sales from Brazil’s coffee producers.
The ICE-monitored robusta supplies dropped to a record low of 1,958 lots. Arabica bean inventories dropped to a 24-year low of 224,066 bags but recently recovered to 410,877.
Moreover, Vietnam’s weaker coffee supplies are bullish in terms of prices. Vietnam is the top global producer of robusta beans.
On the other hand, higher exports of the commodity in Honduras, the largest coffee producer in Central America, pulled down prices. The country reported a rise of 26.00% YoY to 932,678 bags.
Asian Coffee Producers Pulled Up Prices due to Robust Demand
On March 07, coffee premiums in significant Asian robusta producers like Vietnam and Indonesia boosted prices.
Central highlands farmers were selling beans for $3.60 to $3.68 per kilogram, higher than last week’s $3.36 to $3.40 a kilogram.
According to traders, farmers and dealers ran out of coffee beans to sell. Domestic prices hit their 90,000 per kilogram mark as premiums rose amid a decline in dong and more substantial ICE prices.
On Wednesday, robusta coffee for May exports increased by 4.00% to $3,309 per metric ton.
Meanwhile, Sumatra beans for April delivery in Indonesia were offered at $710, lower than the $800 last week. A trader added that the higher cost would adjust with the London terminal.
