"Daily arrivals have reached between 700 and 900 tonnes in Sumatra since last week. Harvests are underway and the peak is expected to be in June," said one Jakarta-based trader.

"Falls in London have encouraged farmers to quickly sell their beans for fear that prices will fall. But most exporters take a wait-and-watch stance, except for those who are short of beans."

Beans from Indonesia's Sumatran growing areas of Lampung, Bengkulu and South Sumatra are exported through Lampung's Panjang Port. Daily arrivals were between 500 and 600 tonnes late last month.

Indonesia's crop for the 1998-99 coffee crop season (Oct-Sept) could reach 4,25,000 tonnes, against 3,60,000 tonnes in 1997-98, trade sources said.

Coffee futures closed sharply down in London last Friday, hitting 18-month lowsbefore industry buying at the cheaper prices lent support, traders said.

Both May and July futures slumped on the London International Financial Futures and Options Exchange (LIFFE) to new lows at $1,462 per tonne. Spot May coffee was last traded down $40 at $1,464 per tonne.

In Indonesia, grade-four robusta beans were quoted at 10,500/11,000 rupiah/kg in Lampung on Monday, compared with last week's 12,000 rupiah/kg. FOB prices were quoted at $1,300/$1,350 per tonne against $1,430 per tonne.

The Jakarta-based trader said news of big harvests from Indonesia had worried Vietnamese coffee exporters, who believed their prices would be affected.

"Actually, there is nothing special about the estimate that the coffee crop will reach 4,25,000 tonnes. Indonesia's harvests should reach 5,00,000 tonnes if everything goes well," he said without elaborating.

Some traders said this year's coffee harvests were expected to be delayed to June from March because of rains triggered by the La Nina weather phenomenonbut others said harvests had started in late March.

"It seems that harvests are pretty normal. Demand is expected to be high this month, but some exporters are sidelining because of the volatile market," said one trader in Bengkulu.

"Farmers are interested in selling their beans, especially because exporters who are short of beans are willing to spend much money to cover their stocks," he said.

The trader said coffee prices could fall further to 9,000 rupiah/kg in Lampung if the market in London remained bearish and the rupiah stayed stable.

The rupiah was quoted at 8,745/8,775 against the dollar at 0531 GMT.