Export coffee prices have increased 2.5 times.
According to the Ministry of Agriculture and Rural Development (MARD), in the first seven months of 2024, Vietnam exported 964,000 tons of coffee, earning $3.54 billion. Notably, despite the decrease in quantity, the export value of coffee increased by 30.9% in the first seven months.
According to the Vietnam Coffee and Cocoa Association (VICOFA), the increase in coffee export value is due to the rise in Vietnam's export coffee prices on the world market, especially in key markets. In particular, in Vietnam's main coffee export markets such as Spain, Russia, the US, Indonesia, the Philippines, the Netherlands, and China, import prices have increased by approximately 30% compared to the previous year.
Currently, coffee prices have increased nearly 2.5 times compared to this time last year. The reason for the increase in export coffee prices is due to increased import demand from other countries, but revenue is decreasing, especially since the current supply of coffee from the 2023-2024 crop year is limited.
According to Mr. Nguyen Nam Hai, Chairman of the Vietnam Coffee and Cocoa Association, the recent surge in coffee prices is due to several factors, including the impact of climate change and the El Niño phenomenon causing droughts across global coffee-growing regions, leading to reduced supply. Besides climate factors, military conflicts worldwide and tensions in the Red Sea have increased shipping costs and other expenses. Furthermore, many global financial speculators (after oil and gold) have chosen coffee as a speculative asset, which is also a major factor affecting the price of this commodity.
Coffee could join the "5 billion USD export club".
According to VICOFA, Vietnam currently has only about 148,000 tons of coffee left for export in the remaining two months of the 2023-2024 crop year (from August 2024 to the end of September 2024). Meanwhile, the new crop year will not begin harvesting until October 2024.
Limited supply could push coffee prices on the world market to continue rising in the near future.
Besides price factors, market conditions are also very favorable. Specifically, in the UK market, the volume of Vietnamese coffee exported to that country has increased.
According to the Import-Export Department (Ministry of Industry and Trade), in June 2024 alone, Vietnam's coffee exports to the United Kingdom reached 2.18 thousand tons, worth 9.1 million USD, an increase of 24.4% in volume and 15.1% in value compared to the previous month. During the same period, the average export price of Vietnamese coffee to the United Kingdom reached 4,174 USD/ton, an increase of 49% compared to the same period last year.
The Ministry of Industry and Trade also forecasts that Vietnam's coffee exports to countries such as Spain, Russia, the United States, Indonesia, the Philippines, the Netherlands, and China will continue to be optimistic in the coming period.
With favorable factors in price, market, and production volume, coffee exports in 2024 are projected to reach a record $5 billion. The coffee industry will contribute to overall economic growth, and coffee will become a valuable export item joining the "club of exports exceeding $5 billion".
According to the People's Committee of Dak Lak province, in the context of the volatile global coffee market, Dak Lak province has developed a sustainable coffee development plan: It will not increase coffee acreage beyond the planned area, and will focus on converting inefficient coffee plantations with insufficient water resources to other crops.
In addition, Dak Lak focuses on implementing information technology in the management and sustainable production of coffee; developing management software and training personnel to apply information technology in the implementation of plans, inspection and monitoring of sustainable coffee production processes; creating digital maps of plantation histories, and updating the database annually on the replanting and variety improvement situation.
Dak Lak province has also planned to provide financial support for the registration of expanded protection for Buon Ma Thuot geographical indication coffee products; continue to implement quality management and ensure food safety; and encourage the business community to apply advanced quality management systems from around the world.
Source: https://laodong.vn/kinh-doanh/xuat-khau-ca-phe-co-the-dat-ky-luc-5-ti-usd-trong-nam-2024-1379287.ldo
