Vietnam’s coffee sector is achieving a significant milestone. In 2024, it is anticipated that exports will generate more than $5 billion for the first time. This accomplishment demonstrates that Vietnam is a key participant in the worldwide coffee market. The rise in international coffee prices and the growth in the value of its coffee exports are driving this success.
Unmatched price increase
The year 2024 is proving important for Vietnam’s coffee industry. Do Ha Nam, the Vice Chairman of VICOFA and Intimex Group, noted the importance of this year as Vietnamese Robusta coffee prices hit record highs. It draws attention to Vietnamese coffee’s rising international renown. Robusta coffee has surpassed Arabica coffee in global value for the first time.
Robusta makes up around 97% of the coffee output in Vietnam. It emphasizes the nation’s position as the leading producer of this type.
The rise in prices has been striking. In January 2024, the cost to export Vietnamese coffee was just over $3,000 per tonne. By October, that price had jumped to $5,855 per tonne (a staggering 90% increase in under a year).
During the initial eleven months of 2024, the typical export price stood at $4,037 per tonne. This represents a 56.9% increase compared to the equivalent timeframe in 2023.
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Export volume and revenue trends
Despite a small reduction in export volumes, the rise in coffee prices has more than compensated for the drop. Between January and November 2024, Vietnam shipped approximately 1.2 million tonnes of coffee, generating $4.84 billion in revenue.
This indicates a 15.4% drop in volume and a remarkable 32.8% rise in revenue compared to the previous year. After the 2023–2024 crop year, the coffee sector achieved a historic milestone, as revenues surged to $5.43 billion, representing the first time export revenues surpassed $5 billion in one crop year.
Germany, Italy, and Spain are the top countries that import coffee from Vietnam. Germany is in the forefront. In 2024, there was an impressive rise in shipments to Malaysia and the Philippines, where imports saw a more than twofold increase. This trend reflects an increasing recognition of Vietnamese coffee in Southeast Asia, emphasizing its rising international visibility.
Take a look at the materials from 2023 to 2024 together:
- Vietnam’s coffee business has been significantly influenced by the growing season of 2023–2024. Despite a 12% decline in export volumes to 1.46 million tons, the income gain greatly outpaced these losses.
- This achievement was mainly fueled by soaring prices, which enabled the industry to reach its record revenue. This era also laid the groundwork for even greater achievements in the 2024–2025 agricultural year.
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2025 farm forecast
Vietnam started the coffee harvesting season for 2024–2025 in November, brimming with optimism. Production for this season is projected to reach approximately 1.6 million tonnes.
Nevertheless, increasing local consumption, expected to range from 270,000 to 300,000 tonnes, may restrict the supply of coffee available for export.
The global market significantly affects Vietnam’s coffee exports. Recently, Brazil, the top producer of coffee globally, completed gathering its harvest. Numerous Brazilian coffee farmers hesitate to sell their coffee beans as they expect a price increase in the upcoming crop cycle. This scenario enables Vietnam to significantly influence global coffee supply and prices, particularly in early 2025.
Farmers wait for increased profits
The harvest time has begun in Vietnam’s Central Highlands, the nation’s centre for coffee cultivation. Despite this, several farmers have decided to delay their sales. The significant profits from other lucrative crops, such as durian and pepper, have given farmers the financial freedom to hold out for improved coffee prices.
This tactic and strong global demand have contributed to a consistent increase in local coffee prices.
Key factors driving record revenue
Several factors have converged to drive Vietnam’s coffee export revenue to record levels in 2024:
- Surging global demand: The global coffee market is experiencing heightened demand, with Vietnam’s Robusta coffee emerging as a preferred choice for many international buyers. Its competitive price point and versatility in blends make it highly attractive.
- Limited global supply: Adverse weather conditions in other coffee-producing nations, coupled with Brazil’s reduced market activity, have created supply constraints, further elevating prices.
Rising local consumption: Vietnam’s expanding coffee culture enhances domestic demand, contributing an additional level of value to the sector. - Strategic market diversification: Expanding exports to Southeast Asian countries such as Malaysia and the Philippines has created new income avenues, lessening dependence on conventional European markets.
- Improving quality benchmarks: Vietnam’s initiatives to enhance coffee quality and comply with international standards have bolstered its global reputation, allowing for increased export prices.
Vietnam’s role in the global coffee market
The world’s biggest producer of Robusta coffee is Vietnam. It greatly influences the global coffee market. Robusta is an essential component of espresso and instant coffee because of its distinct flavour and affordability.
This ensures that there is a steady demand for it. Vietnam can adapt to changing market conditions, like rising prices, showing its strength and competitiveness.
Experts say Vietnam’s role in the global coffee market will keep growing. The country plans to take advantage of favourable conditions during the 2024–2025 harvest season. By the end of this year, export earnings are expected to reach a record $5.5 billion, strengthening Vietnam’s position as a leading coffee producer globally.
Obstacles ahead
Even with its remarkable success, Vietnam’s coffee sector encounters various difficulties. Variable weather patterns, increasing production expenses, and rivalry with other coffee-producing countries may affect future expansion. To succeed in the long run, we must balance local consumption with the availability of exports.
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Nevertheless, industry leaders continue to feel hopeful. VICOFA has pointed out numerous benefits for Vietnamese coffee exports, such as a boost in supply from the fresh harvest season and consistently high export prices. By harnessing these advantages, Vietnam can overcome potential challenges and maintain its growth path.
Conclusion: A new era for Vietnamese coffee
Vietnam’s coffee sector is entering a new phase of expansion and success. The remarkable accomplishments of 2024—featuring historic export earnings and international acclaim—highlight the industry’s capacity to attain even higher success.
With the 2024–2025 crop year advancing, everyone will focus on Vietnam as it persistently influences the future of the worldwide coffee industry. Thanks to strategic foresight, strong market demand, and a dedication to quality, Vietnam is progressing towards becoming a more influential player in the coffee sector.
The anticipated $5.5 billion in export earnings isn’t merely a figure; it reflects the dedication, creativity, and effort of all participants in the nation’s coffee industry, from growers to exporters. For Vietnam, the greatest is still ahead.
