Domestic coffee prices today
The domestic coffee market this morning, May 7, witnessed an impressive breakthrough session in the Central Highlands provinces.
According to the latest data, the average purchase price of the whole region has increased by 1,000 VND/kg, officially exceeding the threshold of 87,000 VND/kg.
Specifically, in Dak Nong province (old), coffee prices increased the most with 1,100 VND, reaching 87,300 VND/kg.
Dak Lak and Gia Lai provinces both recorded an increase of 1,000 VND, currently trading stably at 87,000 VND/kg.
The Lam Dong area alone listed the price at 86,500 VND/kg after recovering by 1,000 VND compared to yesterday's session. Meanwhile, pepper prices remained stable at 143,000 VND/kg and the USD/VND exchange rate at Vietcombank decreased slightly by 10 VND to 26,088 VND/USD.
World coffee prices
Developments in the international market last night recorded mixed differentiation between the two futures exchanges.
The London exchange became the main driver for domestic coffee prices when Robusta futures in July surged by another 35 USD (equivalent to 1.04%), reaching 3,413 USD/ton.
Conversely, the New York exchange sank into red when Arabica prices fell sharply by 5.90 cents (equivalent to 2.04%), falling to 283.85 cents/lb. Arabica's decline stems from optimistic signals about the possibility of ending the US-Iran conflict, which opens up expectations that the Strait of Hormuz will soon be cleared again, helping to relieve global logistics pressure.
Coffee price assessment
Despite cooling geopolitical news, factors tightening supply in reality are still a solid pillar for coffee prices. Robusta inventories on the ICE exchange fell to a record low of 16.25 months (only 3,755 lots), while Arabica inventories also hit a 2.5-month low.
In addition, Brazil's Real continued to maintain its strength at its highest level in 2.25 years against the USD, causing Brazilian farmers to limit export sales due to unfavorable exchange rate differences. These factors compensated for the pressure from the Vietnam's export report in the first 4 months of the year increasing sharply by 15.8% (reaching 810,000 tons) and the forecast of a global surplus of 10 million sacks of StoneX.
The market is currently in an extremely sensitive phase when "good news" about geopolitics is "bad news" for prices due to reduced insurance and transportation costs. However, with stockpiles on the London exchange running out, Robusta's upward momentum still has considerable room in the short term.
