Coffee farmers in Viet Nam, the world’s biggest grower of robusta, are selling more beans before the Lunar New Year holidays, according to traders including Nguyen Van An of Thai Hoa Production and Trading Corp.

“It’s easier for us to buy coffee from farmers now than last month because they are selling more to get cash for Tet,” An said by telephone Thursday from Hanoi. Vietnam’s ‘Tet’ Lunar New Year festival is next week.

Any increase in Vietnamese supplies may pare a rally in coffee prices. Robusta futures for March delivery Wednesday rose $24, or 1.45%, to $1,680 a ton on the Liffe Exchange. It posted its first annual decline last year since 2003 on speculation that increased production in Asia and Africa will outpace consumption.

Vietnamese shippers may sign more export contracts after the Lunar New Year holidays on speculation international prices will rise, according to both An and Huu Thanh Hong, business manager of Dak Lak-based Sept. 2nd Import-Export Co., Vietnam’s third-biggest exporter.

“Export prices of Vietnamese coffee are still pretty low now, so many traders don’t want to contract much,” Hong said by phone Thursday from Dak Lak, Vietnam’s largest growing area. “International prices may rise in the next few weeks.”

Export prices for March delivery at Ho Chi Minh City port are around $1,530 per ton, down from more than $2,000 a year ago, Hong said. Coffee was sold at around VND25,500 ($1.46) per kilo in Buon Ma Thuot, capital of Dak Lak province, he said.

As few as 300,000 tons have been contracted for shipment from Vietnam so far this year, said Dak Lak-based Van Thanh Huy, former chairman of the Vietnam Coffee and Cocoa Association, and now general director at Dak Lak Import-Export Investment Co.

Contracts for about 500,000 tons of shipments had been signed in the same period a year earlier, Huy said. (Bloomberg)