* Vietnamese beans offered at $70-$90/T below Liffe's May
* February exports at 184,100 T, above expectations
* Vietnam's coffee crop safe from dry weather -traders
By Ho Binh Minh
HANOI, March 18 (Reuters) - Coffee prices in Vietnam fell on Tuesday, pulled down by a decline in London robusta futures market, putting a brake on farmers' selling that began early this month, traders said.
Robusta prices rising beyond a key level of 40,000 dong per kg in Vietnam, the world's largest producer of the bitter beans used mainly for making soluble coffee, has prompted farmers to accelerate selling in the past two weeks.
On Monday, global coffee markets retreated as a forecast for widespread rain in top grower Brazil's coffee belt took out some of the market's weather premium. May robusta on Liffe
On Tuesday prices in Vietnam, which closely track London futures prices, eased around 1 percent from the previous day to 41,000-41,300 dong ($1.94-$1.96) per kg, well below 41,600-41,700 dong a week ago.
"After a strong sale last week, farmers are not selling now as prices ease a bit," a trader in Ho Chi Minh City said.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For FACTBOX on Vietnam's coffee crop, click
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Farmers in the Central Highlands coffee belt, who grow coffee on some 80 percent of the region's total coffee acreage, had earlier expected prices to rise to 45,000 dong per kg on dry weather affecting the Brazilian crop.
But lower prices in London pulled Vietnamese prices down this week, and also narrowed the discounts of Vietnamese beans.
On Tuesday, Vietnamese robusta grade 2, 5 percent black and broken were offered at $70 to $90 a tonne below the May contract, down from $85-$110 last Tuesday.
In the same period last year, the beans were offered at premiums of $40 a tonne to London futures prices.
While sales slowed this week, Vietnam's coffee export data for February suggested supply to the global market was ample.
Last month Vietnam exported 184,100 tonnes (3.07 million bags) of coffee, a surge of 83.4 percent from a year ago, Vietnam Customs said last Thursday, far above market expectations.
Some coffee farms have been facing water shortage in the central highland province of Kontum, as the dry season peaks in the region, state-run Liberation Saigon daily said on Tuesday.
The newspaper report followed a similar statement issued on March 6 by the Vietnam Coffee and Cocoa Association (Vicofa), the industry body, which said the dry weather could be one of the reasons to reduce output of the next 2014/2015 crop.
Traders widely dismissed Vicofa's forecast, saying the crop has not been hurt. The crop year lasts from October to September.
"There's been no impact from the dry weather on coffee at all," said a trader in Daklak, the country's largest coffee growing province in the Central Highlands. "Farmers are watering trees in the third phase and everything so far has been normal."
Kontum is the smaller coffee growing province among the five provinces in the Central Highlands, producing around 25,000 tonnes a year, or 1.5 percent of Vietnam's total output.
Farmers often water trees three to four times, starting in February, with each phase lasting about 10 days and intervals of around 20 days each, until rain returns in early May.
($1=21,070 dong)
(Editing by Anand Basu)
((ho.minh@thomsonreuters.com; +844 3825 9623; Reuters Messaging: ho.minh.thomsonreuters.com@reuters.net))
Keywords: MARKETS VIETNAM/COFFEE
