HANOI, Feb 23 (Reuters) – Coffee prices in Vietnam widened on Thursday, with bids and offers far apart, while Indonesia was stable despite Brazil’s sudden reversal of a decree marking the first time the world’s largest producer would buy green coffee abroad.
Coffee prices in Daklak, Vietnam’s largest growing province, widened to 45,200-46,600 dong ($1.98-$2.04) per kg , from 46,000-46,500 dong a week ago, but very few trades were made due to thin supply, traders said.
Discounts on 5-pct black and broken grade 2 robusta in Vietnam also widened to $40-$100 a tonne below the London’s ICE May contract, from a discount of $50-$70 a tonne a week earlier, traders said.
“At the moment, farmers hold beans as there are not so many coffee left in house and they still expect prices to increase…(Overseas) roasters also turned down the exports quotation offers,” said independent analyst Nguyen Quang Binh.
Robusta coffee futures slipped on Wednesday, with the May contract down 1.28 percent at $2,161 a tonne, as Brazil’s President Michel Temer ordered a suspension of the authorisation of robusta coffee imports.
Brazil was set to allow imports of 1 million 60-kg bags of coffee from Vietnam, the world’s top producer of robusta often used in instant coffee, at a 2 percent tariff for the first time under a decree outlined this week, but the plan was halted.
“The Vietnamese market actually does not react to Brazil’s swing; people don’t really care as news like those are quite frequent, although the London market was affected a little, but mostly by speculators,” said a Ho Chi Minh City-based trader.
In Indonesia, Vietnam’s major rival, prices were barely changed, with the robusta grade 4, 80 defects quoted at a premium of $3-$20 a tonne to the May contract, compared with $5-$20 a week earlier, traders said.
“Coffee trading is still quiet and it will probably be like this until April or May approaching the harvest in June,” one Lampung-based coffee trader said. ($1 = 22,830 dong) (Reporting by Mai Nguyen; Additional reporting by Mas Alina, editing by David Evans)