Bloomberg News

Indonesia’s 2012-13 Coffee Harvest Seen Completed in Lowlands

August 31, 2012

Harvesting of the 2012-13 coffee crop in Indonesia, the third-biggest robusta grower, is over in the lowlands and 60 percent finished in the highlands, according to Volcafe Ltd., the coffee unit of ED&F Man Holdings Ltd.

Bean deliveries from farms rose to 5,000 metric tons from 2,000 to 2,500 tons last week, when arrivals had slowed because of the Muslim holiday of Eid, which marks the end of the fasting month of Ramadan, Volcafe said in a weekly report e-mailed today. The domestic market was “very active again,” it said.

Robusta prices have climbed 15 percent this year on NYSE Liffe in London as global demand is forecast to advance to 66.1 million bags in 2012-13 from 62.6 million bags in 2011-12, Volcafe estimates. Prices fell 7.1 percent in the past month.

“Most producers and local collectors are holding back their stock a bit, anticipating a higher price before they sell,” Volcafe said in the report.

Coffee production in Indonesia will rise to 10.1 million bags in the season that started in April there, Winterthur, Switzerland-based Volcafe estimated in a quarterly report earlier this week. That compares with 6.2 million bags in 2011- 12, when above-average rains brought by the La Nina weather pattern, a cooling of the Pacific Ocean, damaged the crop. Output was 9.4 million bags in 2010-11, it said.

Indonesia Premium

Buyers of Indonesian beans for September and October shipments were paying a premium of $40 a ton over the price on the NYSE Liffe exchange in London, according to Volcafe. That is unchanged from last week, its data showed.

In Vietnam, the biggest robusta producer, export and stockpile figures indicate the 2011-12 crop may be about 27.3 million bags, Volcafe said. The country produced 20 million bags in 2010-11, Volcafe estimates. Inventories in Ho Chi Mihn city fell by 5,000 tons in August, it said.

The new crop in Vietnam will start in October and exporters are in the “off-season mood and sporadically give some new crop offers,” the trader said.

Buyers of Vietnamese beans for September and October shipments were paying a premium of $30 a ton over NYSE Liffe, up from $25 a ton last week, Volcafe data showed.

Robusta coffee for November delivery rose 0.7 percent to $2,079 a ton by 4:14 p.m. on NYSE Liffe.

To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.


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