Vietnam faces coffee scarcity despite price hikes
Although coffee prices have increased continuously in recent days, Vietnam lacks supply to serve domestic consumption and exports, according to the Vietnam Coffee-Cocoa Association (Vicofa).
On Tuesday, September 19, coffee prices in the domestic market rose to VND300-400 ($1.6 U.S. cents) per kilogram. In the Central Highlands and southern provinces, the purchasing price surged to VND65,500-70,000 ($2.88) per kilogram. Vietnam's coffee export prices have also recorded consecutive hikes in recent days, the association said.
Since the beginning of the year, rising domestic and export coffee prices have boosted the value of Vietnam’s coffee industry.
In the first eight months of this year, Vietnamese coffee was exported to 38 markets with the highlight being an increase in export price to a record $3,054 per ton, nearly $700 higher than the same period last year.
During this period, Vietnam shipped 1.2 million tons of coffee, worth about $3 billion, Vicofa said.
The country earned $4.06 billion from exporting 1.78 million tons of coffee in 2022, an increase of 13.8% in volume and 32% in value compared to 2021. This was also the first year in history that Vietnam’s coffee export value topped the $4 billion mark.
According to the International Coffee Organization, Vietnam ranked second in the world in terms of coffee export market share in the February 2021-January 2022 period, only after Brazil.
Prices in Dak Lak province, dubbed “the coffee capital of the country”, and the entire Central Highlands region in general are hovering around VND65,000-68,000 ($2.8) per kilogram, the highest in the past 10 years. However, since the coffee season is ending, many local households say there is nothing to supply to the market.
"In recent times, many farmer households have switched from coffee to other fruit trees. Some intensive coffee gardens are now intercropping with durian trees, resulting in reduced output," said one Dak Lak farmer.
Phan Minh Thong, chairman of Phuc Sinh Corporation, said world coffee prices depend heavily on Vietnam as it has the second largest supply.
"Crop failures and reduction in coffee growing areas have reduced supply and pushed up prices. This problem needs to be solved," Thong said.
According to the Vicofa, lack of credit access meant that many businesses did not have enough capital to buy and stock coffee.
This year's coffee output is estimated to decrease by 10-15% due to unfavorable weather, the association said.
However, the situation is still positive for Vietnam’s coffee exports from now until the end of the year because of increased demand and limited supply. It is expected that Vietnam will export about 1.72 million tons of coffee this year, earning $4.2 billion, the Vicofa said.
Unlikely to last
Pham Quang Anh, director of the Vietnam Commodity News Center, said the high coffee prices may not last long.
He noted that leading coffee producers Brazil and Indonesia have supplies from the new crop and were actively promoting exports. Meanwhile, Vietnam will begin harvesting its the 2023/24 crop in the fourth quarter of this year, contributing to adding a large amount of coffee in the market.
Therefore, Anh stressed, there was a need to improve statistics and forecasting data on the coffee market to help farmers and other stakeholders access timely accurate information about market trends.
A Vicofa executive said that the industry needed to continue restructuring and improve quality.
For this to happen, experts have said that individuals and businesses need to get loans at preferential rates to invest in growing, processing and trading coffee. There should also be solutions to facilitate product origin traceability to make Vietnamese coffee more marketable.
To earn higher returns from the industry, the Ministry of Agriculture and Rural Development has approved a 10-year (2021-2030) project to develop Vietnamese specialty coffees. Under the project, the specialty coffee area will account for 2% of the total and produce 5,000 tons by 2025; and 3% and 11,000 tons by 2030.
- Read More
Central Vietnam province plans to build $2.4 bln LNG power plant from 2031
The 4,800-MW Chan May LNG power plant, with an investment of $2.4 billion, can be deployed in 2031-2035, according to Thua Thien Hue authorities.
Energy - Thu, November 21, 2024 | 10:41 pm GMT+7
Indonesia, France step up cooperation in economy, defence
Indonesian President Prabowo Subianto discussed economic and defence cooperation during a bilateral meeting on Tuesday with French President Emmanuel Macron on the sidelines of the G20 Summit in Rio de Janeiro, Brazil, Antara reported.
Southeast Asia - Thu, November 21, 2024 | 10:25 pm GMT+7
Thai economy to maintain upward momentum in 2025
The National Economic and Social Development Council of Thailand (NESDC) expects the Thai economy to sustain its upward momentum in 2025 with a growth of 2.3-3.3% despite growing risks.
Southeast Asia - Thu, November 21, 2024 | 10:24 pm GMT+7
Former parliament chairman Vuong Dinh Hue warned for violations
The Politburo, Vietnam's supreme decision making body, on Wednesday issued warnings to Vuong Dinh Hue, former Chairman of the National Assembly, and Nguyen Van The, former Minister of Transport, for violations while on duties.
Politics - Thu, November 21, 2024 | 10:10 pm GMT+7
Sumitomo insists on building LNG power plant in central Vietnam
Japanese trading house Sumitomo has been pushing for a liquefied natural gas (LNG)-fed power plant investment in Vietnam’s central province of Khanh Hoa.
Energy - Thu, November 21, 2024 | 8:53 pm GMT+7
Vietnam’s Vinhomes fulfils 67% of record buyback plan
Vinhomes, the housing development arm of conglomerate Vingroup, has purchased back 246.98 million shares, meeting 66.75% of the plan and accounting for 5.7% of the outstanding volume.
Finance - Thu, November 21, 2024 | 8:43 pm GMT+7
Vietnam high-speed railway should run beyond Hanoi, HCMC on either side: lawmakers
Vietnam’s mega North-South high-speed railway project should be redesigned and extended beyond Hanoi and Ho Chi Minh City as currently planned, several lawmakers have suggested.
Infrastructure - Thu, November 21, 2024 | 6:11 pm GMT+7
Vietnam-Malaysia relationship upgraded to comprehensive strategic partnership
Vietnam and Malaysia have upgraded their relationship to a comprehensive strategic partnership, the highest level in the former’s diplomatic hierarchy.
Politics - Thu, November 21, 2024 | 5:21 pm GMT+7
Petrovietnam units sign LNG supply deal for trial run of Vietnam’s first LNG power plants
PV Power and PV Gas, two units of state-owned Petrovietnam, have signed an LNG supply deal for trial operation of Nhon Trach 3 and Nhon Trach 4, Vietnam’s first LNG-to-power plants.
Energy - Thu, November 21, 2024 | 4:40 pm GMT+7
Sufficient first phase funds ensured for Vietnam’s new mega airport: transport minister
Minister of Transport Nguyen Van Thang affirmed Wednesday that funding would be secured for building the Long Thanh International Airport, set to become Vietnam’s biggest.
Infrastructure - Thu, November 21, 2024 | 3:53 pm GMT+7
Bamboo Capital wins kudos for transparent reports, good governance
Vietnamese private conglomerate Bamboo Capital Group has been honored as a Top 20 business with the Best Annual Report and the Best AGM Organization at the 2024 Vietnam Listed Company Awards (VLCA).
Bamboo Capital - Thu, November 21, 2024 | 3:37 pm GMT+7
VAFIE to organize workshop on amendments to horse racing, football betting rules
The Vietnam’s Association of Foreign Invested Enterprises (VAFIE) and The Investor will organize a workshop on suggestions to amend the government’s Decree 06 on horse racing, greyhound racing and international football betting services.
Economy - Thu, November 21, 2024 | 2:38 pm GMT+7
Vietnam Politburo okays international, regional financial centers in HCMC, Danang
Vietnam’s highest decision-making body, the Politburo, has greenlighted the establishment of an international financial center in Ho Chi Minh City and a regional financial center in the central city of Danang.
Economy - Thu, November 21, 2024 | 1:50 pm GMT+7
Singapore's Platinum Victory seeks to gain veto at Vietnam’s REE
Singaporean fund Platinum Victory Pte. Ltd. has registered to buy more shares of Ho Chi Minh City-based utility firm Refrigeration Electrical Engineering Corporation (REE) to achieve the vetoing power in the latter.
Finance - Thu, November 21, 2024 | 11:29 am GMT+7
Posco keen on investing in Vietnam's $2.2 bln LNG power project
South Korea’s steelmaker Posco is eyeing to invest in the $2.2 billion Quynh Lap LNG-fired power plant project in Vietnam’s central province of Nghe An.
Energy - Thu, November 21, 2024 | 10:42 am GMT+7
Vietnam firm Hoa Lam to build $212 mln Aeon Mall in Mekong Delta
The Mekong Delta city of Can Tho has accepted a subsidiary of private multi-sector Hoa Lam Group as the investor of the Aeon Mall Can Tho commerce and service center.
Industries - Thu, November 21, 2024 | 10:31 am GMT+7