AsemconnectVietnam - Vietnamese coffee prices eased on Tuesday in line with global trends, while buying demand appeared to be thin following strong exports so far this year, traders said.

Vietnam, the world's top robusta producer, has exported an estimated 1.32 million tonnes (22 million 60-kg bags) of coffee in the first nine months of the 2015/2016 season, up 32 percent compared with last year, the government said.

There was a brief pick-up in prices early this month when robusta futures rose beyond $1,700 a tonne.

June coffee exports rose 46 percent from last year to an estimated 160,000 tonnes, based on government data. However, this is the smallest monthly shipment since February.

ICE September robusta  LRCU6 settled down 0.3 percent at $1,664 per tonne on Monday, having lost 3.6 percent since June 8, when the contract hit a seven-month high of $1,726 a tonne.

That is the second consecutive drop after Britons voted to leave the European Union last week.

Traders said the global coffee market may not suffer long.

"The market decline can be short while it takes time to complete the whole exit process," said a second trader in Ho Chi Minh City. The United Kingdom is not among the top 10 buyers of Vietnamese coffee.

In Daklak, the country's key growing province, domestic coffee prices eased to 36,000-36,300 dong ($1.61-$1.63) per kg on Tuesday from 36,700-37,000 dong a week ago.

Vietnamese robusta grade 2, 5 percent black and broken were offered at premiums of $40-$50 a tonne to the September contract, narrowing from $30-$50 last week.

Based on USDA data, coffee exports so far in the 2015/2016 season would leave around 11 million bags in Vietnam. As per the data, carryover stocks are at 6.4 million bags, while output stood at 29.3 million bags and domestic consumption at 2.6 million bags. A drought, which affected the Central Highlands' coffee output, is one of the reasons for Vietnam posting its slowest second-quarter growth in two years, the government said. Output of the 2016/2017 season is forecast to drop 7 percent to 27.3 million bags, based on a USDA projection.

The country's coffee crop year lasts from October to September, starting with a four-month harvest.

Source: Reuters.com