The world can import less coffee from Vietnam – the world’s largest robusta coffee growing country. This is the type of coffee used in instant drinks and popular esporesso coffee today. Lower output and growing domestic demand have limited export supply.
Mr. Do Ha Nam, Vice Chairman of the Vietnam Coffee and Cocoa Association, said at a conference in Ho Chi Minh City that the country can produce 1.6-1.7 million tons of coffee from the current harvest. , down from 1.78 million tons a year earlier. He said reserves from the previous crop were almost exhausted.
This is considered bad news for global consumers, who are facing increasing costs of living. Robusta coffee futures in London rose to their highest level since 2008 earlier this year due to lack of supply. Last month, coffee prices also recorded the highest increase since the beginning of the year.
According to Mr. Nam, the coffee growing area in Vietnam is shrinking, especially in large provinces such as Dak Lak and Dak Nong while productivity is also decreasing in some areas.
The total coffee area in the country is currently about 600,000 hectares, according to Mr. Nam, compared to the recent estimate of the Ministry of Agriculture of 700,000 hectares, due to farmers cutting down coffee trees to plant more profitable crops such as durian, avocado.
Mr. Nguyen Nam Hai, Chairman of the association, said Vietnam’s exports could decrease by 15% in the 2023-2024 crop year from 1.66 million tons a year earlier. Domestic prices increased more than 40% compared to a year ago.
According to Mr. Nam, domestic coffee consumption could increase to 350,000-400,000 tons compared to the current 260,000 tons when instant coffee factories reach maximum capacity.
According to the Ministry of Agriculture and Rural Development, in the first 11 months of 2023, Vietnam’s coffee exports are expected to reach 1.36 million tons, worth nearly 3.5 billion USD.
Currently, Vietnam’s largest coffee import market is the EU, followed by the US, Japan…
Coffee exports to China do not account for a high proportion, but many Vietnamese businesses are also interested in this market. Because, China has an average increase in coffee imports of more than 25% per year as young people in this country increasingly prefer coffee to tea.
Source: Bloomberg
