Robust demand for robusta to boost Vietnam’s coffee exports
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Vietnam’s coffee exports can hit a record high this year because of high global demand for the robusta variety. Coffee exports this year could top over 1.8 million tons, said Do Ha Nam, deputy chairman of the Vietnam Coffee and Cocoa Association.
“The world market has consumed all the coffee shipments from Vietnam. Supply has been insufficient to meet demand,” Nam said.
The shortage comes as global’s demand for instant coffee is expected to rise this year, especially in developing markets.
Global consumption of robusta, mainly used by big companies including Nestle SA to make instant coffee, is forecast to climb to a record high this season.
The worldwide market for instant coffee is set to expand 4.7 percent a year through 2023 to $14 billion from $10.4 billion in 2017, market research firm IMARC said in a recent report.
Higher demand has boosted domestic coffee prices.
The price of coffee in the Central Highlands, Vietnam’s major coffee-growing belt, hit VND35,300-36,100 ($1.51-1.54) per kilogram in early October, higher than that VND32,500-33,300 ($1.39-$1.43) per kilogram in early September.
Coffee exports from Vietnam grew at an estimated 21.5 percent between January and October from a year ago to 1.58 million tons, according to the General Statistics Office.
Coffee export revenues for Vietnam, the world’s biggest producer of the robusta beans, rose 1.1 percent to $2.98 billion in this year’s 10-month period, the office said.
Questions & Answers
Q.Which specific coffee variety is driving the predicted record export figures for Vietnam?
Which specific coffee variety is driving the predicted record export figures for Vietnam?
The robusta variety is the key driver, experiencing high global demand. This demand is partly due to the expected rise in instant coffee consumption, especially in developing markets this year.
Q.How much higher are Vietnamese domestic coffee prices now compared to September?
How much higher are Vietnamese domestic coffee prices now compared to September?
In early October, prices in the Central Highlands were VND35,300-36,100 per kilogram. This is higher than the VND32,500-33,300 per kilogram recorded in early September, reflecting the boosted demand.
Q.What is the projected growth rate for the instant coffee market globally?
What is the projected growth rate for the instant coffee market globally?
The worldwide market for instant coffee is expected to expand by 4.7 percent annually through 2023. This will see its value rise from $10.4 billion in 2017 to an estimated $14 billion.
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