Vietnam, the world’s largest coffee producer, is facing a challenging year. Coffee exports in November fell 47% year-on-year, marking the lowest level in more than 15 years. What’s behind this drop, and what steps does the coffee industry need to take to weather the storm?
Coffee Exports Hit Rock Bottom: Weather Slows Harvest
Despite being in the harvest season, coffee exports in November only reached 63,019 tonnes, nearly half of what was exported during the same period last year. The primary reason for this decline was unfavorable weather conditions, particularly unusual rains that persisted throughout December in the Central Highlands, the country's main coffee-growing region.
Flooded coffee fields have made both harvesting and drying difficult.
Additionally, the coffee trees bloomed earlier than expected, potentially leading to reduced productivity for the upcoming crop. Alongside weather challenges, low coffee inventories have also played a significant role in reducing exports. With limited supply, many export orders are facing difficulties, directly impacting coffee output on the international market.
New Crop Coffee Market Forecast
For the 2023-2024 crop year, coffee output is estimated to reach 1.5 to 1.6 million tonnes, a 6% decrease compared to the previous crop year. The forecast for the 2024-2025 crop year, currently in the harvest stage, also predicts a continued decline due to the combined impacts of weather and lower crop yields.
In the face of these production and export challenges, the coffee industry must innovate its strategies to adapt to these difficult conditions.
A Ray of Light: Record-High Coffee Prices
Despite the downturn in export volume—down 14% cumulatively from the beginning of the year through November—the export value reached $4.93 billion, up 35.4% compared to last year. This increase in value is primarily due to high coffee prices. It demonstrates the strong pricing power of Vietnamese coffee in the global market, allowing Vietnam to maintain its position as a leading player in the coffee industry, even with lower output.
The Value of Vietnamese Coffee Is Still Highly Appreciated on the Global Market
