Vietnam has the second largest coffee output in the world, just after Brazil, and is the biggest Robusta producer. Vietnam has benefited from the ‘price storm’ in the world market. The General Department of Customs (GDC) showed that in 2023 Vietnam exported 1.61 million tons of coffee, worth $4.18 billion, a record high.

In January 2024, coffee exports brought turnover of $620 million, up 103 percent over January 2023.

Robusta prices on ICE Europe-London on January 31 with delivery in March closed at $3.305 per ton and $3,168 with delivery in May.  As such, the prices have increased by 16.3 percent and 14.9 percent, respectively, compared with late December 2023, and by 62.2 percent and 57.5 percent, respectively, compared with the same period last year.

Robusta prices have jumped on ICE’s record low inventories since 2014. Speculators and funds have increased purchases.

Meanwhile, shipping freight and goods insurance premiums have increased because of re-routing. Ships now have to take a roundabout to reach destinations because of the tensions in the Red Sea.

Droughts in the world’s largest coffee export countries, including Brazil and Vietnam, have caused coffee output to decrease, raising worries about shortages.

In 2023, because of economic difficulties, roasters had to cut production costs and consumers had to tighten their purse strings. Many used Robusta instead of Arabica as an alternative solution.

Domestic coffee prices have been escalating daily. In Dak Lak, coffee is collected at VND79,000 per kilogram. The price is VND78,200 in Lam Dong, VND78,000 in Gia Lai and VND79,500 in Dak Nong.

According to Phan Minh Thong, CEO of Phuc Sinh,  coffee prices have been increasing over the last year. In early 2023, the price jumped from VND34,000 to VND48,000, a 15-year high, and farmers rushed to sell all their coffee. When the price soared to VND50,000, farmers ran out of coffee to sell. 

The price began galloping in May and June before reaching a historic record high of VND67,000 per kilogram in July, while warehouses became empty.

The prices have increased since late 2023, surpassing the VND70,000 per kilogram threshold and near VND80,000 per kilogram. Vietnam’s Robusta coffee is in high demand as roasters have changed their formula with more Robusta use.

The Ministry of Agriculture and Rural Development estimated that the coffee output would drop to 1.66 million tons in 2024, but coffee exports are expected to bring turnover of $5 billion thanks to high prices.

Tam An