At the end of the trading session on May 2, world coffee prices continued to be sold off strongly to the lowest level in 3 weeks. The recovery in coffee inventories has eased supply concerns and prompted liquidation of extended coffee futures.

Specifically, on ICE Futures Europe, the price of Robusta coffee delivered in July 2024 decreased by 298 USD/ton, at 3,680 USD/ton; delivered in September 2024 decreased by 291 USD/ton, at 3,617 USD/ton.

Similarly, on ICE Futures US, the price of Arabica coffee delivered in July 2024 decreased by 9.70 cents/lb, at 206.30 cents/lb, for delivery in September 2024 decreased by 9.30 cents/lb, at 204.75 cents/lb.

Data shows that Robusta coffee inventory on ICE Futures Europe as of May 1 reached 39,450 tons - the highest level in the past 5 months. Meanwhile, Arabica coffee inventory on ICE Futures US also recovered to its highest level in the past year, reaching 682,036 bags (60 kg/bag).

Coffee prices on both floors continue to fall without stopping. Coffee was sold off very strongly, pushing prices to the lowest level in 3 weeks. The recovery in coffee supply in the market has eased supply concerns and prompted the liquidation of long term positions.

In a March 2024 Reuters poll, 10 traders and analysts were interviewed. Most forecasts suggest that Arabica coffee prices will end 2024 around 165 cents/pound. If this is true, it means the price of the main coffee type will decrease by about 9% compared to the level at the end of 2023. Robusta coffee prices are also expected to end 2024 at around 2,600 USD/ton, 14% lower than the price at the end of last year.

In the first 6 months of the 2023 - 2024 coffee season (from October 2023 - March 2024), Vietnam exported 956,000 tons of coffee, total turnover reached more than 3 billion USD

Poll participants at the time believed coffee prices would come under pressure in April-May due to a more favorable supply outlook.

Forecasting prices from now until the end of 2024 is still a bit early because there will be many fluctuations in weather, as well as supply from producing countries, we will still have to wait, however, the comments of the Analysts as well as leading traders will affect the current price, because the next action is usually to sell futures right now and that easily affects the price of coffee.

The reason that poll participants expect is that coffee production in leading grower Brazil will increase to 69.5 million bags in 2024/25 from 66.1 million bags in 2023/24 and is expected to increase to 69.5 million bags in 2024/25. Expect output in Vietnam, the world's second largest producer and the leading grower of Robusta coffee, to increase by 1.5 million bags to 29.5 million bags in 2024/25.

Three analysts polled by Reuters said the main factor in the market will be the change in climate patterns, from the current El Nino to a possible La Nina in the second half of the year.

El Nino is generally considered more negative for coffee production because it tends to lead to drier weather for Robusta growing regions in Asia and a warmer-than-average climate in Brazil. A shift to La Nina could bring more favorable weather for coffee plants.

Domestic coffee prices have plummeted unprecedentedly, falling sharply to 12,500 VND/kg, trading at about 117,500 - 118,000 VND/kg. Trading activity remains weak in Vietnam after a five-day holiday. However, Vietnam's supply exported 756,000 tons of coffee in the first 4 months of this year, up 5.4% over the same period last year, reaching a turnover of 2.57 billion USD, up 58% over the same period.

According to the Vietnam Coffee - Cocoa Association (Vicofa), in the first 6 months of the 2023 - 2024 coffee crop year (from October 2023 - March 2024), Vietnam exported 956,000 tons of coffee , a total turnover reached more than 3 billion USD. Thus, Vietnam has exported about 60% of the total expected output of about 1.6 - 1.7 million tons of the current crop year.

Mr. Do Ha Nam, Vice President of Vicofa, said that in the first 6 months of the 2023 - 2024 coffee crop year (from October 2023 - March 2024), Vietnam exported 956,000 tons of coffee, a total turnover of more than 3 billion USD. Thus, Vietnam has exported about 60% of the total expected output of about 1.6 - 1.7 million tons of the current crop year.

Facing major challenges such as area decline due to crop restructuring and climate change leading to a decline in output, Mr. Le Duc Huy, Director of Dak Lak 2-9 Import-Export Company Limited , believes that this is the time when members of the coffee supply chain need to discuss difficult issues and cooperate in the spirit of sharing and accompanying development.

At the same time, there is a selection and gradual removal of seasonal and unreliable business units and partners from the supply chain. In addition, key coffee growing localities in the Central Highlands also need solutions to increase coffee output and quality through improving varieties and gardens, applying new farming techniques, and adapting to climate change. climate change, Mr. Le Duc Huy shared.