HANOI, Aug 29 (Reuters) - The threat of looting posed by high coffee prices and sunny September weather may lead to poorer bean quality as Vietnamese coffee farmers start harvesting early to protect the crop and cash in, traders said on Tuesday.
They said the looters will be active in the key coffee-growing Central Highlands as long as prices in the world's top producer of robusta stay around 20,000 dong ($1.25) per kilogram, near a five-year high.
A kilogram of robusta beans eased to 20,600 dong ($1.29) on Tuesday from 21,500 dong on Aug. 23, which is the highest since global coffee prices crashed in 2001.
"Prices are so good now and if they remain above 20,000 dong, looting is inevitable," said a Ho Chi Minh City trader.
Another trader said it was common when prices were high for hired labourers to loot the same farm they worked for at night.
"The weather has been very good now and if sunny days come in September, the harvest could start early because some cherries are ripe," he said while en route to survey the crop.
Cherries ripened early as rains falling during the previous October-January harvest resulted in an early blossom.
The mid-October start of Vietnam's harvest follows the arrival of the -dry season. Growers said rainfall was good after a drought ended early last year.
But an early harvest that takes place while coffee cherries are green, coupled with hasty picking to avoid looting, will make it difficult to process coffee and raise the ratio of black beans. Unripened cherries tend to be disqualified during processing because the high moisture content in the cherries spoil the beans in them.
Black beans are regarded as defective and may affect the selling price.
LOSSES
Deputy Agriculture Minister Diep Kinh Tan told a coffee quality seminar last Thursday that harvesting unripened cherries could mean losses of 100,000 tonnes each crop.
Vietnamese industry officials said farmers were aware of the quality problem, but they often chose to harvest early rather than leave them unprotected on the farm.
About 80 percent of Vietnam's coffee is grown by 600,000 farmer families, making it difficult for the state to control crop production and ensure stable quality.
"It is the farmers' call and no power can interfere," the first trader told Reuters.
Vietnamese robusta, which is used to make instant coffee and which is priced lower than aromatic arabica, is sold at discounts to London futures contracts partly because of its lower quality.
On Tuesday, Vietnamese exporters, aware of a possible dearth of good quality beans in November due to numerous committed shipments, have reduced making offers. The London market's closure for a public holiday on Monday also contributed to Vietnam's slow trade.
But traders said robusta grade 2, 5 percent black and broken was recently quoted at $70 to $90 a tonne to the LIFFE November contract
Prices in Vietnam then fell gradually to $290 in early October 2001, when world prices plunged to 30-year lows.
The government has estimated coffee exports will rise 9.7 percent to 835,000 tonnes, or 13.9 million 60-kg bags, between October 2005 and August 2006, over the same period in the previous crop year.
($1=15,976 dong)
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