Coffee price news for the week 16-12/12: Unusual signals between domestic and International markets

This week’s coffee price fluctuations from 16/12 to 12/12 reflect a tug-of-war between the pressure of abundant supply from major exporting countries and uncertain signals from weather conditions and macroeconomics, requiring sharp forecasting and strategy from stakeholders.

Coffee Prices in Vietnam This Week (16/12 – 21/12)

The coffee prices in the Central Highlands this week show unstable fluctuations, with a downward trend starting in the middle of the week. This reflects pressure from abundant supply as the harvest season peaks, combined with buyers’ cautious mindset due to unpredictable fluctuations in the international market. This decline may make it harder for farmers to achieve their expected profits.

Summary of Domestic Coffee Prices (VND/kg) for the Week of 03 December

International Coffee Prices (09/12 – 14/12)

The Robusta coffee prices in London and Arabica coffee prices in New York showed sensitivity to supply-demand factors and market sentiment this week.

Robusta Prices on London Exchange (USD/ton) for 16 – 21 December

The Robusta coffee prices on the London exchange experienced significant fluctuations this week, with a downward trend starting in the middle of the week, especially on 20/12 and 21/12, when prices sharply dropped. The main cause was the increasing supply pressure as Vietnam, the world’s largest Robusta exporter, entered the peak of its harvest season. Additionally, investor caution due to unfavorable global economic signals contributed to the price decrease. The market is now awaiting purchasing actions from roasters, which could offer short-term price support.

Arabica Prices on New York Exchange (cents/lb) for 19/12 – 21/12

Arabica coffee prices on the New York exchange showed notable volatility this week, with a sharp rise on 17/12 and 19/12 driven by optimistic weather reports from Brazil, suggesting a potential shortage of rain affecting yield. However, profit-taking pressure and concerns about reduced purchasing power due to a stronger USD led to a price drop on 20/12. A slight recovery on 21/12 indicates that investors remain confident in stable demand from major consumption markets. In the medium term, Arabica is expected to maintain strong fluctuations as Brazil’s supply is closely monitored.

Coffee Market Review and Price Forecast for Next Week

Over the past week, coffee prices in the Central Highlands provinces such as Dak Lak, Gia Lai, and Lam Dong showed complex fluctuations. The week started with a slight increase due to the domestic demand for raw materials from local companies, but prices gradually decreased, particularly towards the end of the week, as the new harvest’s supply continued to flood the market. This drop reflects increased selling pressure from farmers aiming to take advantage of relatively good prices before the holiday period. Additionally, stable weather in coffee-growing regions did not pose significant risks to the harvest, which further strengthened abundant short-term supply.

On the international market, both Robusta and Arabica prices saw strong volatility. For Robusta, increased supply pressure from Vietnam, the world’s largest Robusta exporter, caused prices to drop sharply towards the end of the week. This reflects market concerns over an oversupply in the short term as exports from Vietnam and Indonesia rise. Meanwhile, Arabica prices on the New York exchange showed the opposite trend with strong mid-week increases due to adverse weather forecasts in Brazil, the world’s leading Arabica producer. However, profit-taking pressure at the end of the week pulled prices back down, reflecting market uncertainty due to unfavorable global economic signals, especially with a stronger USD, which reduces purchasing power in key import markets.

These fluctuations are primarily influenced by two key factors: supply-demand dynamics and market sentiment. On the supply side, Robusta supply from Vietnam and Indonesia increased as the harvest entered its peak phase. In contrast, with Arabica, concerns over drought conditions in Brazil temporarily pushed prices higher before technical selling pressure emerged. Additionally, macroeconomic signals, including interest rate policy changes in the US and Europe, significantly impacted investor sentiment, increasing price volatility on exchanges.

Domestically, coffee prices are expected to remain under downward pressure due to abundant supply. However, if purchasing companies increase stockpiling activities ahead of the holiday season, prices may stabilize at a more balanced level. On the international market, Robusta prices may continue to adjust downward in the short term due to a forecasted increase in exports from Vietnam. For Arabica, weather factors in Brazil will continue to play a crucial role in shaping price trends. If drought conditions persist, prices could find short-term support. However, weaker global demand due to a stronger USD may limit any price increases.

In summary, the coffee market is facing many uncertainties, requiring all stakeholders—from producers to investors—to closely monitor market movements and adjust strategies accordingly to optimize their benefits.

43 Factory Coffee Roaster has provided this week’s coffee price summary. For more information on coffee machines and other useful updates, please visit our news page!