Indonesia Coffee Premium Said by Volcafe to Rise With Delays

Buyers of coffee from Indonesia, the world’s third-biggest robusta grower, are paying a bigger premium for their beans this week with local prices high and shipments delayed, according to Volcafe Ltd.

Indonesian coffee for May and June shipments is $100 a metric ton above the price on the NYSE Liffe exchange, the Winterthur, Switzerland-based unit of commodities trader ED&F Man Holdings Ltd. said in a report e-mailed today. That compares with a premium of $90 a ton last week.

“Sellers’ price ideas are moving farther away from buyers’ ideas,” Volcafe said in the report. “Some of the nearby shipments for April and May have been delayed from Panjang due to the shippers not able to buy coffee in time.”

Coffee prices within Indonesia were trading at 19,200 rupiah ($1.97) to 20,500 rupiah a kilogram (2.2 pounds), according to the report. That compares with 19,000 rupiah to 20,300 rupiah a kilogram last week. Robusta coffee rose 0.5 percent in the past week to $2,019 a ton in London.

Indonesia is harvesting its 2013-14 crop and production is set to climb to 11 million bags of 60 kilograms (132 pounds) from 10 million bags a year earlier, according to CoffeeNetwork, a unit of brokerage INTL FCStone Inc. Bean deliveries from farms in Indonesia were 3,500 tons to 4,000 tons this week, up from 2,400 tons to 2,600 tons a week earlier, Volcafe said.

In Vietnam, the world’s largest robusta producer, local prices remained “firm” as farmers waited for better prices. Bean stockpiles in Ho Chi Minh City fell 20,000 tons to 220,000 tons compared with a month earlier, according to the report.

“Business was hardly done and differentials remained firm to slightly higher,” Volcafe said. Farmers are “not in a hurry at all to sell the coffee.”

Vietnamese coffee beans for May and June shipments were at a premium of $90 a ton to the exchange price, Volcafe data showed. That is unchanged from last week.

In India, supplies in the local market are “very low,” with farmers holding about 32 percent of the crop, Volcafe said.

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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