April 2, 2020 / 7:36 AM / 2 months ago

Asia Coffee-Trade frozen in Vietnam as social distancing begins for two weeks

HANOI/BANDAR LAMPUNG, Indonesia, April 2 (Reuters) - Coffee trading in Vietnam has been frozen this week as it began 15 days of social distancing from Wednesday to curb community transmission of the coronavirus, while the arrival of new supplies in Indonesia is a month away.

The Vietnamese government has told residents to stay at home, only going out to buy food or in emergency cases for two weeks from April 1.

Trading activities, therefore, have been halted, traders said.

“There will be no new deals struck in the next two weeks, at least. I don’t know when things can be back to normal, maybe months,” said a trader based in the Central Highlands, Vietnam’s largest coffee-growing area.

“Beans shipments will also be disrupted as very few workers are at the port right now.”

July robusta coffee settled down $18 or 1.5%, at $1,204 per tonne on Wednesday, the lowest level in two years, Refinitiv data showed.

Meanwhile, Indonesia’s Sumatran robusta coffee beans are offered with $200 to $250 premium to July contract this week in Lampung province, one trader said, compared with about $300 premium to May contract last week.

“It is difficult to set the premium this week because the dollar continues to strengthen against the rupiah, while no new stocks are coming in yet,” one trader said. The Indonesian rupiah is trading at its weakest since the 1998 Asian financial crisis.

Meanwhile, traders are expecting the harvest to start around May.

Other traders said premiums were unchanged at $300 to $350 for May through July contracts.

Indonesia’s March Sumatra coffee bean exports are up 43% against the same period last year.

Reporting by Phuong Nguyen in Hanoi and Mas Alina Arifin in Bandar Lampung; Editing by Robert Birsel

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