Vietnamese coffee industry sets new revenue record

According to the Vietnam Coffee-Cocoa Association (VICOFA), Vietnam exported nearly 1.45 million tonnes of coffee during the 2023-2024 season, spanning from October last year to September, generating $5.32 billion in revenue. While volume decreased by 12.7 per cent, export value increased by over 30 per cent, setting an all-time industry record.

Photo: baodautu.vn

The EU remained Vietnam's largest coffee export market during the 2023-2024 season, with a value of $2 billion, up 41 per cent from the previous season, accounting for 38 per cent of volume and 37 per cent of export value.

According to congthuong.vn, the coffee market witnessed unprecedented developments this season. Do Ha Nam, vice chairman of VICOFA, said, "For the first time, Vietnamese coffee commanded the highest prices globally, with Robusta export prices exceeding Arabica prices. London futures prices surpassed $5,000 per tonne, occasionally reaching beyond $5,500."

The EU's Deforestation Regulation is seen as a significant advantage for Vietnamese coffee exports, as the coffee industry here has prepared well.

"If this regulation is implemented as initially planned, Vietnamese coffee will continue to be a global favourite as the most compliant supplier," Nam said.

Coffee market expert Nguyen Quang Binh described 2024 as a miraculous year for the industry. Vietnamese and global coffee markets experienced an unprecedented price surge, with prices increasing by 1.5 times compared to the previous year.

Despite this, however, many coffee firms have faced challenges. "Rapid price increases amid limited supply have disrupted the supply chain. Export businesses haven't been able to deliver on time, leading to negative reactions from partners, buyers, and roasters."

Binh believes the market will continue to show volatility, emphasising the need for industry adjustments to maintain sustainable growth.

"Vietnam's coffee industry must address supply chain gaps and restore export partner confidence. Farmers should prioritise quality improvement over rapid expansion to avoid oversupply. Businesses should invest in processing and value-added products alongside raw coffee trading to ensure long-term sustainable growth," Binh said.

Potential price hikes weigh on top coffee chains Everyday coffee habits may have to be cut back as beverage outlets consider plans to increase prices to compensate for the increase in raw coffee.

Supply pressures ahead for Vietnam’s coffee exporters Coffee export businesses are wary over an October start for the harvest season, meaning healthy export figures thus far in 2024 may be dampened by dwindling supply.

Coffee sustainability under pressure The continuous fluctuations in prices and tightening import standards from international markets are creating significant challenges for the Vietnamese coffee sector.