Weekly Coffee News: Asia Pacific

General Market News

After a solid downward move during the last two weeks, we had a short trading week in Europe intertwined with a consolidation phase in both coffee markets.

The combination of rains in Vietnam and Brazil, certified stocks rebounding from historic lows, and a significant sell-off from investment funds had driven coffee prices substantially lower, as well as other commodities such as cocoa. Arabica prices stopped the downward correction and consolidated in a range of 195 c/lb to 200 c/lb. The market closed the week almost unchanged at 201.15 c/lb. After such a roller-coaster move of the last months, it is unsurprising to see the market recovering a little and searching for a clear new direction.

International Robusta prices also recovered during the week and are still digesting the massive moves from the historic highs of 4,338 USD/MT to Friday's close of 3,440 USD/MT. The week closed almost 3% lower than the previous Friday.

Somebody hit the "pause" button on these otherwise very active and volatile coffee markets. One thing is sure: volatility will soon return to the markets. Speculation on the back of climate change, war, and geopolitical distress will indeed ensure this.

Refer to the table below to stay informed about the ever-changing coffee market. We update this table weekly, providing the latest insights and updates.

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Indonesia

In an effort to get young people to move to the new capital city of Nusantara, Indonesia's Government is recruiting influencers to hype it up on social media. This capital city, being built from scratch and planned to be inaugurated in August of this year, has come into play as Jakarta faces many environmental challenges. The town is the fastest-sinking mega-city on the planet, hosting more than 30 million people. Jakarta is and shall stay the economic center of Indonesia, while Nusantara will be home to the Government and its National Administration.

In the northern parts of Sumatra, the Arabica fly crop is complete, and the last bits and pieces are coming down the mountain towards the exporter's warehouses for further processing. The coffee trees are recovering from the harvesting stress, and the main crop cherries are slowly and steadily continuing their maturation process. The Robusta harvest is coming forward and moving into its final stage in the southern parts of Sumatra, but at a much slower-than-expected pace. This is pushing local prices higher, as exporters need to pay up to get their hands on the coffee.

On the beautiful islands of Bali, Java, and Sulawesi, the crop continues to mature on the trees. Good weather conditions are helping to bring those cherries up to full maturation. The early pickings and, thus, the beginning of the harvest are expected to start towards the first weeks of June.

No significant updates from the port of Lampung; logistics are operating without disruptions.

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India

The harvest ended some months ago in India's Arabica and Robusta-producing regions. The trees are recovering, and farmers are not only doing some basic husbandry on the trees but also still sitting on a substantial volume of coffee. This is keeping internal prices on the higher edge, but the falling international markets have encouraged some farmers to step in and sell part of their coffees as they are scared of missing out on the high prices. Nonetheless, the demand for Robusta continues to be high despite the high price scenario.

The monsoon season is about to start in the next few weeks. During this time of the year, the heavily humid air and excessive rains help process coffees stored in specially prepared warehouses and convert them into Monsooned Malabar coffees. We keep our fingers crossed and hope the needed rains will come soon.

Given the slow movement of coffee, shipments are delayed as exporters struggle to get the necessary quantities to meet their contractual obligations. There are no significant updates from the ports so far.

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Vietnam

Weather concerns and scorching heat affected water supplies in Vietnam's southern provinces. Luckily, some rains appeared in the Central Highlands, bringing needed rains to the coffee regions in Dak Lak, Lam Dong, and Kontum. These showers didn't go unnoticed as international Robusta prices began to fall from their historic high of 4,338 USD/MT. Farmers started to sell following the falling prices and wanted to monetarize at least something of this historic moment. Nonetheless, the coffee regions of Gia Lai and Dak Nong still need some rain, and the drought could potentially affect the next harvest.

Besides the ongoing challenges posed by the Red Sea crisis, there are no significant updates from the port.

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Papua New Guinea

The Eastern and Central Highlands of Papua New Guinea have been experiencing heavy rainfall, which has caused logistical challenges such as landslides and overly muddy roads, which have complicated transportation.

Despite these challenges, local farmers are gearing up for the harvest season with positive expectations for quality and volume. The first samples of the new crop are eagerly anticipated soon, and the first pickings are expected to start within the next few days.

Exporters have prepared the warehouses, and their dry mills are looking forward to receiving the first arrivals of parchment of the new season.

No significant news from the port.

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Asia Pacific Production Statistics?

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