Bloomberg News

Indonesia Coffee Premium Gains as Roasters, Exporters Buy

April 27, 2012

The premium buyers are prepared to pay to obtain coffee from Indonesia, the world’s third-largest producer of robusta beans, rose 25 percent this week on demand from local roasters and exporters, according to Volcafe Ltd.

Indonesian beans for shipment in May and June were trading at a premium of $100 a metric ton to the price on the NYSE Liffe exchange in London, the unit of commodities trader ED&F Man Holdings Ltd. said in a report e-mailed today. That compares with a premium of $80 a ton last week, data from the trader showed.

The premium has “firmed up as local roasters and exporters keep on battling to pick up the coffee available,” Volcafe, based in Winterthur, Switzerland, said in the report.

Beans were at a higher premium even as the flow of coffee in Indonesia improved this week, with port arrivals estimated at about 4,500 tons, Volcafe said.

In Vietnam, the biggest robusta producer, bean sales by farmers slowed “considerably” after “some heavy farmer selling” over the weekend, the trader said. Shipments continue to be “of high volume,” according to the report.

Coffee exports from Vietnam totaled 21 million bags in the year ending in April, up 1.6 million bags from the same period a year earlier, Volcafe estimates.

Vietnamese coffee for May and June shipment was trading at a discount of $10 a ton to the exchange price, unchanged from the previous week, Volcafe data show.

Robusta coffee for July delivery was down 0.4 percent at $2,003 a ton by 3:35 p.m. in London.

To contact the reporter on this story: Isis Almeida in London at ialmeida3@bloomberg.net

To contact the editor responsible for this story: John Deane at jdeane3@bloomberg.net


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