COFFEE FARMERS in Vietnam, the top supplier of robusta used by Nestle SA, probably have the largest unsold inventories in at least five years as they hang onto supplies in anticipation of a recovery in prices.
Growers were hoarding 42 percent of the crop by the end of April, the median of eight trader estimates compiled by Bloomberg showed. That’s the most since at least 2010 and compares with a five-year average of 27 percent, according to traders. Production will reach 1.72 million metric tons in the year from next October, down about 4 percent from a previous estimate because of dry weather, they said.
Planters are holding back beans after futures in London lost 18 percent in the past 12 months amid improving crop prospects in Brazil, the second-biggest producer of robusta and top grower of arabica beans, and forecasts for a record harvest in Indonesia. Income from other crops such as pepper and durian fruit are supporting farmers, said Sept. 2nd Import-Export Co.