Vietnam's Coffee Production and Exports Expected to Decline Amid Smaller Crop and Growing Local Demand

According to Yahoo News, the world may face a shortage of coffee from Vietnam, the largest producer of robusta beans used in instant drinks and espressos, due to a smaller crop and increasing local demand. Vietnam is expected to produce 1.6 million to 1.7 million tons of beans from the current harvest, down from 1.78 million tons a year earlier, according to Do Ha Nam, deputy chairman of the Vietnam Coffee Cocoa Association, speaking at a conference in Ho Chi Minh City. He also mentioned that stockpiles from the last crop were nearly depleted. This supply outlook is concerning for consumers, who are already experiencing higher prices for their daily coffee. Robusta futures in London reached their highest level since at least 2008 earlier this year due to supply shortages and had their largest gain last month since January. Farming areas in Vietnam are decreasing, particularly in the major provinces of Dak Lak and Dak Nong, while yields are also declining in some regions, according to Nam, who is also the chairman of top exporter Intimex Group. Total coffee acreage in Vietnam is likely around 600,000 hectares, compared to the agriculture ministry's last estimate of 700,000 hectares, as farmers switch to more profitable crops such as durians and avocados. Vietnam's coffee exports may drop 15% in the 2023-24 season from 1.66 million tons a year earlier, according to Nguyen Nam Hai, chairman of the association, who also spoke at the conference. He added that harvesting was 50% completed by the end of November, and local prices have risen more than 40% from a year earlier. Local consumption of beans may increase to 350,000-400,000 tons a year from the current 260,000 tons once instant coffee plants reach full capacity, according to Nam, without providing a time frame.