Buyers of coffee from Indonesia, the world’s third-biggest producer of the robusta variety, are paying bigger premiums for their beans as futures fall and farmers hold back supplies, according to Volcafe Ltd.
Indonesian beans for shipment in July and August are at a premium of $200 a metric ton to the price on NYSE Liffe in London, the Winterthur, Switzerland-based coffee unit of commodities trader ED&F Man Holdings Ltd. said in a weekly report e-mailed today. That’s up from $150 a ton last week. Robusta coffee futures fell 4.9 percent this week.
“Differentials widen further with every dollar Liffe goes lower,” Volcafe said, referring to the premium paid to obtain physical coffee in relation to the futures price. Exporters are “paying high prices” and farmers are holding back coffee, it said.
Rainfall across most of the country’s coffee belt is slowing bean deliveries from farms, Volcafe said. That may be leading some exporters to try to delay shipments, it added.
In Vietnam, the world’s top robusta grower, buyers are paying a premium of $135 a ton to the exchange price, up from $120 a ton last week, Volcafe data showed.
Robusta coffee for September delivery gained 1.6 percent to $1,758 a ton by 3:07 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: Claudia Carpenter at Ccarpenter2@bloomberg.net.