World coffee prices turned up, robusta slightly adjusted, arabica increased strongly at the end of the week. The weak USD continued to support coffee prices. Meanwhile, low inventories, continuously decreasing sharply, supported a slight recovery in robusta coffee prices.

Domestic coffee prices, after 4 consecutive days of decline, recovered slightly this weekend.

The Brazilian Coffee Exporters Association's report on coffee exports of all kinds shows that in June, the country's exports increased by 8.6% compared to the previous month, but decreased by 16.6% compared to the same period last year. Combined with the increase in the Real exchange rate, farmers reduced their export sales, supporting the market price increase.

Meanwhile, in the first 6 months of 2023, Vietnam exported 1.01 million tons of coffee worth 2.4 billion USD, down 2.2% in volume but up 3% in value compared to the same period last year. This is the highest coffee export turnover in the first 6 months of the year ever.

Domestic coffee prices today, July 15, increased by 300 VND/kg in some key purchasing localities. (Source: YouTube)

At the end of the weekend trading session (July 14), the price of robusta coffee on the ICE Futures Europe London exchange turned around slightly. The price of robusta coffee futures for September 2023 delivery increased by 15 USD, trading at 2,540 USD/ton. The price of November delivery increased by 5 USD, trading at 2,405 USD/ton. Trading volume was low.

Arabica coffee prices on the ICE Futures US New York exchange for September 2023 delivery increased sharply by 3.2 cents, trading at 160.8 cents/lb. Meanwhile, the December 2023 delivery increased by 3.25 cents, trading at 160.30 cents/lb. Trading volume was high on average.

Vietnam's coffee exports have grown quite positively in recent times as consumers tend to switch to consuming cheaper robusta coffee compared to Arabica coffee in the context of a global economic downturn, inflation and interest rates remaining high in most major economies.

Roasters are forced to respond to this trend and buy more robusta to blend with arabica in order to reduce the price of the coffee product to the lowest possible level to meet market demand.

Meanwhile, the International Coffee Organization (ICO) forecasts a global coffee supply deficit of 7.3 million bags in the 2022-2023 crop year. The ICO said robusta coffee output is expected to fall 2.1% in the current crop year to 72.7 million bags, while arabica coffee is expected to increase 4.6% to 98.6 million bags. This situation has pushed domestic and export coffee prices in Vietnam to consecutive record highs in recent months.