Vietnam’s Coffee Exports Records YoY Increase of 9% in the First Month of 2022

Published 2022년 3월 3일

In 2021, coffee exports from Vietnam recorded a YoY decline of 2.7% in the volume but the value increased by 9.4%. The increase in value was driven by growing global coffee prices throughout the year due to a drastic fall in coffee stocks across the world. In 2022, Vietnam’s coffee campaign started with a bang as the country exported 175 million mt of coffee in January alone, a 9% YoY increase in volume and a 40% YoY increase in value. Vietnam is aiming to double the value of coffee exports done by Vietnam to USD 6 billion by the year 2030 by expanding its instant/soluble coffee exports. The country also needs to improve its processing facilities, expand its export markets and develop a sustainable coffee value chain to achieve the 2030 target.

Coffee is an important export commodity for Vietnam which is the second-largest producer of coffee in the world after Brazil. Vietnam has exported coffee to more than 80 countries and territories around the world, focusing mainly on big markets like Germany, the USA, Spain, Italy, Belgium, UK. Very recently, Vietnam has also started exporting to emerging markets in Asia like China, Russia, Korea, Japan. According to International Trade Center (ITC), Vietnam exported1.52 million tons of coffee in 2021 which was worth approximately USD 3 billion. The volume of exports saw a YoY decline of 2.7% in volume, but the value of exports was up by 9.4% compared to 2020. According to the International Coffee Organization (ICO), the world coffee price was up by at least 41% in 2021 over the previous year which boosted Vietnam's coffee export value.

In 2022, Vietnam’s coffee campaign started with a bang as the country exported 175 million mt of coffee in January alone. According to the General Statistics Office, the export volume recorded a YoY increase of 9% over January 2021 while the export value recorded a whopping YoY increase of 40.9% reaching USD 395 million. As per the forecast of the Ministry of Industry and Trade, Vietnam's coffee exports in 2022 will continue to remain positive thanks to abundant supply, high export prices, and free trade agreements (FTAs) creating a competitive advantage for Vietnamese coffee. The country is also looking forward to greater production to recover in comparison to the previous year. USDA has projected that coffee production in MY 2021-22 will be 31.1 million bags (60 kg per bag), increasing by 2.1 million bags compared to last year.

Furthermore, Vietnam’s coffee exports will be driven by a shortage of coffee in the global market as Brazil’s coffee production remains impacted by climate change. In addition, rapid urbanization, an increase in e-commerce retail sales, an increase in disposable income in the Generation Z population, and an increased preference for instant coffee will further drive up the demand for robusta coffee, a specialty of Vietnam. Many coffee processors and roasters have started mixing Arabica and Robusta coffee to lower the selling price due to the lack of Arabica coffee supply. Vietnam is also seeking to grow its value of coffee exports by capturing a large share of the global processed coffee market as consumers start developing a fondness for Robusta coffee.

Source: USDA.

The Vietnam Coffee and Cocoa Association (VICOFA) is aiming to double the value of coffee exports done by Vietnam to USD 6 billion by the year 2030. The growth will be backed by increasing infrastructure to process the coffee and export it through instant coffee brands. Although, currently, Vietnam has only a 10% share in the global coffee market., their target is to achieve at least 25% by 2030. Furthermore, the Vietnamese coffee industry is in dire need to strengthen the processing facilities, expand its export markets and develop a sustainable coffee value chain in order to achieve the 2030 target.