Domestic prices in Robusta in Vietnam are higher than Arabica! Coffee prices remain high in the future

Vietnam is the world's largest Robsta coffee producer, but at the same time Vietnam also grows Arabica varieties of coffee beans. Currently, Robsta accounts for 95% of Vietnam's total coffee production, while Arabica accounts for 5% of total coffee production.

Although Vietnam produces a lot of Robusta coffee beans, the price of Vietnamese Arabica coffee beans has always been higher than that of Robusta coffee beans, but this situation has changed recently.

According to a report by the Vietnam Coffee and Cocoa Association (VICOFA), the average price of Robusta coffee exports in Vietnam in May was US$3920/ton, while the average price of Arabica coffee exports was US$3888/ton. This is the first time in Vietnam in nearly 50 years. Robusta prices are higher than Arabica.

At present, according to local coffee companies in Vietnam, domestic coffee prices are higher than recently released official data. The current spot price of Robusta coffee in Vietnam is 132 million-139 million VND/ton, while Arabica coffee The spot price is 100 million-130 million VND/ton.

In addition, the data also showed that the average price of coffee exports from January to May was US$3428/ton, an increase of 50% compared with the same period last year. The average price of coffee exports in May was as high as US$4208/ton, an increase of 11.7% from April, and a year-on-year increase of 63.6% in May last year.

The price of Robusta is higher than that of Arabica coffee, mainly because the market exceeds demand. Although Brazil has recently reported that Robusta's production and exports have increased compared with the past, it has failed to fill the gap created by production cuts in Vietnam and Indonesia.

Although in Vietnam's coffee export report in recent months, coffee exports have increased simultaneously with the rise in coffee prices, due to the impact of long-term high temperatures and drought, Vietnam's coffee industry may experience a decline in output and export volume in the second half of the year. problem.

Therefore, the Vietnam Coffee and Cocoa Association stated that it was earlier expected that a 20% reduction in Vietnam's coffee exports in 2023/24 would remain unchanged. Since more than 1.2 million tons of coffee have been exported, which is higher than the export volume in the same period last year, proving that market stocks are low, demand is high, and prices remain high. Therefore, it is expected that domestic coffee prices will continue to remain high in June.

In the past, when the price of Robusta had not increased, many roasters would choose Robusta and Arabica among their blended coffee beans. However, due to the current price increase in Robusta, roasters may consider Choose more Arabica coffee.

On the other hand, Brazil's new production season in Robusta has begun picking and has a good harvest. The Brazilian Coffee Exporters Council (Cecafé) said that Brazil's coffee exports in 2023/24 are expected to reach 46.3 million bags (60 kilograms/bag), which will hit a record high. These news will slow down the continued rise in Robusta coffee prices.