Green Coffee Bean from Vietnam

History

Coffee was introduced to Vietnam by the French in the 19th century, and its cultivation began in the central highlands, especially in regions like Dak Lak and Lam Dong. Vietnam’s coffee industry began to take off in the 1980s when the government implemented agricultural reforms. By the late 1990s, the country emerged as a major global coffee supplier, especially for robusta coffee, which was more suited to the country’s climate and farming conditions.

Production Regions

• Central Highlands (Tay Nguyen): This region, comprising Dak Lak, Lam Dong, Gia Lai, and Kon Tum provinces, is the heart of Vietnam’s coffee production. The area’s high elevation (around 500–1,500 meters above sea level) and cooler climate are ideal for coffee cultivation.
• South Central Coast: Areas like Quang Ngai and Binh Dinh also contribute to coffee production, though to a lesser extent than the central highlands.
• Southeast Vietnam: Includes the provinces of Dong Nai and Binh Phuoc, which are gradually increasing their coffee production capacity.

Growing Conditions

• Altitude: Coffee thrives at elevations between 600 and 1,500 meters, which ensures optimal temperatures and yields.
• Climate: Vietnam has a tropical monsoon climate with distinct wet and dry seasons. Coffee plants require consistent rainfall (around 1,500–2,500 mm annually) and a dry period to mature.
• Soil: The volcanic soils of the central highlands are rich in nutrients, offering excellent conditions for robusta coffee production. These soils, combined with good water drainage, contribute to the growth of healthy coffee plants.
• Farming System: Coffee is typically grown as a monoculture crop in the central highlands, although smallholder farmers may also cultivate other crops like pepper, maize, and fruit trees.
• Irrigation: Coffee farms are mostly rain-fed, but irrigation systems are used in areas where rainfall is insufficient during the dry season.

Harvesting Process

• Selective Picking: Coffee cherries are harvested selectively, often by hand. Harvesters pick only the ripe cherries to ensure high-quality beans. This process is labor-intensive, especially during peak seasons.
• Mechanical Harvesting: In some areas, particularly larger farms, mechanical harvesting methods are used, which reduces labor costs but may result in lower-quality beans if not properly managed.
• Post-Harvest Processing: Once harvested, the cherries are processed to extract the green coffee beans. The most common methods in Vietnam include the washed and natural process. When washed, the cherries are pulped, fermented, and washed to remove the outer skin and mucilage before being dried. When natural, the cherries are dried with their skins intact, which imparts a different flavor profile to the beans.

Cultivation Methods

• Robusta vs. Arabica: Vietnam is predominantly a robusta coffee producer, with robusta beans making up about 95% of the country's total coffee output. Robusta is favored due to its hardiness, higher yield, and adaptability to Vietnam’s climate. Arabica beans are grown in smaller quantities, mainly in higher-altitude areas like Lam Dong.
• Farming Techniques: Farmers typically rely on traditional farming methods, with limited use of modern mechanization in some areas. However, larger coffee estates often adopt more advanced agricultural techniques to improve yield and quality.
• Sustainable Practices: Sustainability is becoming an increasingly important focus for Vietnamese coffee farmers, with more producers adopting certifications such as Fair Trade and Rainforest Alliance to meet global market demands. However, challenges such as deforestation and soil depletion persist.

Supply Chain

• Producers: There are approximately 500,000 coffee farmers in Vietnam, the majority of whom are smallholders. Large estates also exist, but smallholders dominate production, particularly in the central highlands.
• Cooperatives and Associations: Many smallholders are part of cooperatives, which provide access to resources, better pricing, and technical support. The Vietnam Coffee and Cocoa Association (VICOFA) plays a central role in promoting the industry.
• Private Buyers and Exporters: The majority of Vietnam’s green coffee beans are sold to international exporters. Large traders such as Olam, ECOM, and Louis Dreyfus are active in the market.
• Ports: Coffee exports primarily leave from major ports like Ho Chi Minh City, Da Nang, and Hai Phong, with the former being the most active in coffee exports.

Local Logistics

• Transport: Coffee is typically transported from rural highland areas to processing mills and ports by truck. The infrastructure in coffee-growing regions is improving, but some areas still face challenges due to limited road access, especially during the rainy season.
• Storage: Green coffee beans are stored in warehouses that ensure the correct humidity levels to preserve the beans' quality. However, inconsistent storage conditions at some local mills can lead to issues with mold and spoilage.
• Drying Facilities: In some regions, farmers use natural sun drying methods, while larger farms may have mechanical dryers to ensure more consistent results.

Regulations and Certifications

• Vietnam Coffee and Cocoa Association (VICOFA): This organization sets industry standards and works to improve the quality and sustainability of coffee production.
• Sustainability Certifications: Increasing numbers of farmers are pursuing Fair Trade certification, which ensures higher income and better working conditions. Some Vietnamese coffee producers are certified under the rainforest alliance, which promotes environmental sustainability and social responsibility.
• Export Regulations: The Vietnamese government regulates the coffee export market, including quality control measures to meet international standards.

Quality Standards

• Grading: Vietnam’s coffee beans are graded based on size, shape, and defects. The most common grades are Robusta Grades 1 and 2 and Robusta Grade 3 and below.
• Moisture Content: Coffee beans are required to have a moisture content of less than 12.5% to avoid mold growth and maintain quality during shipping.
• Flavor Profile: Vietnamese robusta beans are known for their strong, bitter flavor, which makes them ideal for espresso blends. The beans’ flavor is also affected by the processing method—washed beans tend to have a cleaner, more acidic taste, while natural beans have a more earthy flavor.

Trade Terms

• Exports (2023): Vietnam is the second-largest coffee exporter globally, with an estimated 1.5 million metric tons of coffee beans exported annually.
• HS Code: 0901.11 (Coffee, not roasted or decaffeinated)
• Top Importers: The main markets for Vietnamese coffee are the European Union, the United States, Japan, and South Korea.

Environmental Impact

• Positive Impacts: The coffee industry in Vietnam has been working on improving its environmental footprint by adopting sustainable farming practices such as agroforestry and using fewer chemicals.
• Negative Impacts: Deforestation and land degradation remain issues in some areas, driven by the expansion of coffee plantations. Additionally, monoculture coffee farming can harm soil health over time.

Social Impact

• Economic Development: Coffee is a key agricultural export for Vietnam, providing livelihoods for millions of farmers. Coffee cultivation in rural areas has spurred local economic growth, particularly in the central highlands.
• Farmer Challenges: Many smallholder farmers struggle with low prices for their crops, fluctuating market conditions, and access to modern farming technology. Cooperatives and government programs aim to provide better support.
• Gender Inclusion: Women in coffee-growing regions often participate in the harvest and processing stages but are underrepresented in leadership roles. Efforts to empower women are part of broader social initiatives.

Uses

• Domestic Consumption: While coffee is a major export product, it is also a beloved beverage in Vietnam, where it is consumed in various forms, such as traditional Vietnamese iced coffee (cà phê sữa đá).
• Coffee Blends: Vietnamese robusta beans are commonly used in coffee blends, particularly in espresso blends for their strong flavor.
• Instant Coffee: Vietnam is a major supplier of raw material for the instant coffee market, with large amounts of robusta coffee processed into instant coffee for international markets.