Any hopes that a flood of coffee exports from Asia’s major growers would take the heat out of a blistering rally that has pushed robusta prices to the highest since the 1970s are fading fast.
Vietnam produces around a third of the worldwide supply of the variety that is mostly used for instant drinks and espresso blends, but a drought followed by weeks of heavy rain has hit the nation’s coffee belt hard just before harvesting that starts in October.
The climatic extremes, and a shrinkage in the amount of land devoted to coffee growing, will cut the country’s harvest by about 10 per cent to 15 per cent this season, said Mr Trinh Duc Minh, chairman of the Buon Ma Thuot Coffee Association in the biggest coffee-growing province of Dak Lak.
“The drought has caused the trees to produce fewer beans, and the beans are also smaller,” he said. “The rain will hinder farmers from picking the beans and drying their coffee, while also causing transport difficulties.”
More than 95 per cent of Vietnam’s coffee output next season will be robusta, according to the US Department of Agriculture (USDA).
The growing popularity of instant and grab-and-go coffee drinks and weather-hit supply have spurred a more than doubling of robusta prices over the past year. It is now almost as expensive as the premium arabica variety, which has also rallied sharply. Volcafe, a major coffee trader, is forecasting a hefty global robusta deficit in the 2024/25 season that starts in October, the fourth annual shortfall in a row.
In Indonesia – which supplies around a tenth of the world’s robusta – it is rising domestic demand rather than problems with the weather that looks set to limit relief to global markets.
Output may reach 10 million 60kg bags in
