Singapore, Sept 18 - Coffee exporters in Indonesia's main growing island of Sumatra have delayed the shipment of between 10,000 and 15,000 tonnes of robusta beans due to high premiums and tight supply, dealers said on Friday.
The delays could encourage roasters to shift to Vietnam, where new harvests just started and beans were offered at a big discount to London futures. Earlier this year, though, Vietnamese exporters had also delayed shipments due to bean scarcity. [COF/AS]
Many Indonesian exporters have made robusta advance sales that were too heavy on expectations of good harvests in the world's second-largest producer after Vietnam, but farmers held back on stocks, hoping for a greater rebound in London futures. .
"The crop coming into Lampung is very little. It's the end of the season and farmers are still holding some beans," said an exporter in Singapore, referring to the growing province of Lampung on Sumatra.
"Indonesian differentials are very high compared with Vietnam's. If this continues, then a lot of people will shift to Vietnam which is selling beans at a discount," said the dealer, who has delayed shipment of Sumatran beans for at least a month.
Dealers said up to 15,000 tonnes of Sumatran robustas failed to be delivered to buyers in recent weeks because of problems in getting beans. A strong rupiah also discouraged sales during the current harvests, they said.
Sumatran grade 4, 80 defects were quoted at a premium of $50 to $60 above London's November contract, lower than the $80 last week, but many dealers also offered the beans at a premium of $100, said dealers.
Vietnamese beans from the previous crop were offered at $40 below November contract, while beans from the new harvest fetched a discount of $100 to $110 under London's January contract.
London November robustas rose $12 to settle at $1,524 per tonne on Thursday to track gains in arabica. The contract has bounced from a lifetime low of $1,250 struck in late June but was still more than 30 percent below a peak of $2,392 last July. [SOF/]
In Indonesia, coffee exporters normally agree on export commitments but delay decisions on prices until after beans have been delivered. Beans were offered by farmers at 15,000 rupiah ($1.6) per kg in Lampung, steady from last week.
"At 15,000 rupiah per kg, the price is equal to $100 premium to London futures, but buyers may only want to pay for the beans at a discount of $100. It's a huge loss," said an exporter in Jakarta.
Indonesia's coffee output is forecast to grow by about 3 percent to 689,000 tonnes in 2009, an agriculture ministry official said, while exports were expected to be steady at 469,000 tonnes. [IDJAK366776]
Differentials of key Asia coffee origins, with reference to the November robusta futures in London:
Sept 18 Sept 11 Indonesia Grade 4, 80 defects +$50+$100 +$80 Vietnam Grade 2, 5.0 pct B&B -40 UNQ ($1=9.690 rupiah)