Coffee price today 8/13/2024

World coffee prices suddenly increased by three digits as soon as they opened and the increase continued until the end of the session.

Domestic coffee prices are trading in the range of 120,000 - 124,200 VND/kg. According to the Vietnam Coffee and Cocoa Association (Vicofa), Vietnam currently has only about 148,000 tons of coffee left to export in the remaining 2 months of the 2023-2024 crop year (from August 2024 to September 2024). Meanwhile, the new crop will not start harvesting until October 2024.

The developments on the two exchanges last night showed that the closing price was much lower than the highest increase of robusta coffee at 303 USD/ton and arabica at 339 USD/ton. The volume of goods traded on the London exchange was not much due to limited supply, on the contrary, arabica coffee had a fairly large wholesale volume.

This unexpected price movement at the beginning of the week was attributed by experts to concerns that frost was returning to Brazil's coffee-harvesting regions. Unlike the hot weather forecast at the end of last week, which caused the market to plummet, earlier this week, Runal Clima unexpectedly predicted that temperatures in Brazil's coffee-growing regions could drop to near-freezing levels, causing damage to coffee plants. Frost will add to the stress on crops from the dry weather in Brazil that has already threatened to reduce next year's coffee production, sending prices soaring.

While the current frost is not causing immediate damage to crops, it is adding to market caution, reflecting the potential impact on Brazil's coffee output and the broader coffee industry for the coming season.

Domestic coffee prices are trading at around 123,000 - 124,000 VND/kg in key purchasing localities. (Source: Kitco)

According to World & Vietnam , at the end of the first trading session of the week (August 12), the price of robusta coffee on the ICE Futures Europe London exchange increased sharply, the delivery term for September 2024 increased by 206 USD, trading at 4,532 USD/ton. The delivery term for November 2024 increased by 197 USD, trading at 4,359 USD/ton. The average trading volume was low.

Arabica coffee prices on the ICE Futures US New York exchange increased, with the September 2024 delivery term up 6.8 cents, trading at 240.85 cents/lb. Meanwhile, the December 2024 delivery term increased 8.3 cents, trading at 238.55 cents/lb. Trading volume was high.

The market's unexpected developments highlight the fragility of coffee production in the face of unpredictable weather patterns.

The coffee market is particularly sensitive to fluctuations in production, and the combination of frost and drought could have serious impacts on the 2025/26 coffee crop. As Brazil faces these dual challenges, the possibility of lower coffee yields is a growing concern, adding another layer of uncertainty to an already volatile market.

As the market closely watches Brazil's weather, any significant changes could cause further volatility in coffee futures.

The interaction between frost, rainfall and current drought conditions creates an extremely uncertain environment for coffee production, with the potential to significantly impact the upcoming harvest.

From the above developments and the recent market, it can be seen that coffee prices, in addition to being affected by limited supply, are also strongly affected by the world financial and monetary markets. Therefore, the market is likely to continue to fluctuate strongly in the coming time. Meanwhile, limited supply can push coffee prices on the world market to continue to increase.