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Indonesia Faces Coffee Shipment Delays as Bean Deliveries Rise

Coffee shipments from Indonesia, the world’s third-largest robusta grower, continue to face delays just as bean arrivals from farms increase, according to Volcafe, the coffee unit of commodities trader ED&F Man Holdings Ltd.

Shipment disruptions at the port of Panjang in southern Sumatra, the country’s main growing area, started as some carriers that usually service the port stopped calling there, creating a shortage of vessels, according to A.P. Moller-Maersk A/S, the biggest container-ship operator. Coffee deliveries from farms in Indonesia rose to about 5,000 to 5,500 metric tons this week from 5,000 tons last week and 2,000 to 2,500 tons a week earlier, said Winterthur, Switzerland-based Volcafe.

There are “a lot of shipment delays still at Panjang due to limited space availability on feeder vessels,” Volcafe said in a weekly report e-mailed today. Feeder ships normally take cargo from smaller ports to larger ones. Their loads are then transferred to bigger vessels for longer-distance voyages.

Beans from Indonesia for shipment this month and the next were trading at a premium of $40 a ton to the price on the NYSE Liffe exchange in London, Volcafe said. That is unchanged from last week. There is some “sporadic external demand,” it said.

In Vietnam, the world’s biggest robusta producer, buyers are paying a premium of $40 a ton to the exchange price for shipment in September and October, up from $30 a ton last week, according to the report. The premium remains “firm” and “some nearby demand is popping up here and there,” Volcafe said.

Traders and industry buyers in Vietnam were seeking information about bean prices for the next crop starting in October, the trader said. The beans were trading at a discount of $30 a ton.

Indian Demand

In India, there was less demand from local roasters this week, bringing down prices, according to Volcafe.

“Since there will not be much carry left for the next year, we expect differentials to start at the higher end” early next season, the trader said, referring to a discount or a premium paid to obtain physical coffee in relation to the price on the futures market.

Robusta coffee for November delivery was up 1.4 percent to $2,041 a ton by 12:51 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.

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