Vietnam’s Coffee Exports Hit Record High – OpEd

Vietnam’s coffee industry is experiencing a breakthrough year, with exports setting new records in both volume and value, the VnExpress newspaper reported.

Coffee exports in the first eight months of 2025 reached 1.2 million tonnes, worth US$6.42 billion, according to the Ministry of Agriculture and Environment.

This represents an 8.7 percent  rise in volume and a remarkable 59.1 percent increase in value compared to the same period last year. With this momentum, export earnings can approach $8 billion in the 2024–2025 crop year, far surpassing the record $5.6 billion of 2024.

According to the Vietnam News Agency (VNA), industry leaders attributed the growth not only to higher global prices but also to Vietnam’s strategy of upgrading quality, expanding specialty coffee, adopting sustainability certification, and meeting international standards. These shifts have helped Vietnamese coffee strengthen its global position and reduce pricing risks.

The average export price stood at $5,580 per tonne, up 46.4 percent year-on-year. Germany, Italy, and Spain remained top buyers, while exports to Mexico surged over 90-fold. Despite modest growth, shipments to China rose 11.7 percent.

Experts noted that longstanding investments in processing technology and supply chain transparency have lifted the competitiveness of Vietnamese Robusta, making it a preferred choice for roasters worldwide. Enterprises are also moving into higher-value segments such as specialty and processed coffee, supported by free trade agreements including EVFTA, UKVFTA, and CPTPP.

Private firms have emerged as a driving force. Vinh Hiep Company of Gia Lai province posted over $750 million in exports and expects to surpass $1 billion this year, accounting for more than 12 percent of national coffee exports.

Meanwhile, Phuc Sinh Group stressed that Vietnamese Robusta, once considered low-priced, is now commanding some of the highest prices globally thanks to advanced processing, modern roasting systems, and expansion into instant and specialty lines.

Vietnam currently cultivates around 732,000 hectares of coffee, with an average yield of 2.9 tonnes per hectare. Advanced farming models can reach up to 5 tonnes per hectare.

Separately, the Khmer Times newspaper reported that Việtnam’s coffee exports to Cambodia surged in July to 713 tonnes worth $2.7 million, up 406 percent in volume and 460 percent in value year on year.

This was released by to the Việtnamese Department of Customs.

In January–July, shipments reached 2,231 tonnes worth $10 million, up 78 percent in volume and 114 percent in value compared with the same period last year.

Businesses attributed the surge to the steady growth of Việtnam–Cambodia trade. Two-way trade reached more than $10 billion in 2024 and surpassed $7 billion in the first seven months of this year.

According to the CNBC website, prices for coffee have soared, fueled largely by volatile weather that’s reduced crop harvests among major growers like Brazil and Vietnam, according to analysts.

Ground roast coffee prices in the U.S. hit $8.41 per pound in July, a record high and a 33 percent increase from a year ago, according to Bureau of Labor Statistics data.

Global coffee prices are hovering near a 50-year high reached in February.

U.S. prices for all coffee varieties (including roasted and instant coffee) were up 14.5% year-on-year in July — the second-highest annual inflation rate for any CPI category behind eggs, according to the Consumer Price Index.

Price pressures “should be easing off” in the near term, said Danilo Gargiulo, a senior research analyst at Bernstein.

But 50 percent tariffs that the Donald Trump administration levied on Brazil threaten to put “upward pressure” on coffee prices, according to an August report from the International Coffee Organization.  

Like all commodities, coffee prices are a function of supply and demand.

According to the CNBC, weather volatility is perhaps the “most critical” short-term factor underpinning coffee supply and prices, since coffee cultivation and yield are “highly sensitive to its environment. 

It was revealed by a Bernstein report published in March.

A severe drought during Brazil’s last summer season “devastated” the harvest, Berstein analysts wrote.

Brazil is the world’s top coffee producer, supplying about 40 percent of the global volume, they wrote. The U.S., the world’s largest coffee importer, sources the bulk of its supply (32 percent) from the South American nation, it said.

Vietnam, the world’s No. 2 supplier, was hit by a drought that caused coffee production to fall by 20 percent in 2024, according to Bernstein.

That was followed by heavy rainstorms that also crimped production, said Mike Hoffmann, professor emeritus at Cornell University and lead author of “Our Changing Menu: Climate Change and the Foods We Love and Need.”

The dynamic — “precipitation whiplash” — reduces crop yield, he said.

“Your standard season isn’t as it should be,” Hoffmann said. 

“Drought stresses the coffee plants, then you get way too much water, and it affects the quality and quantity of the bean, the berries.”

Further, as coffee prices have risen, companies like Starbucks chose to draw down their existing coffee inventories instead of buying expensive beans on the open market, Gargiulo said.

Inventories came down “significantly below historical levels” in the last few years, Bernstein analysts wrote. While the market can weather a shortfall relatively well when inventories are high, low levels can lead to sharp price spikes if there’s a new demand or supply shock, they wrote.

Consumers may also feel higher coffee prices differently depending on whether they shop at the grocery store for coffee to prepare at home or consume it away from home, at restaurants or coffee chains, for example, Gargiulo said.

Coffee prices in the grocery aisle tend to fluctuate more with the commodity cost, meaning they are generally more volatile, he said. Grocers may be quicker to raise store prices as coffee prices rise, and may offer promotions to consumers when coffee prices fall, he said.

But prices for food commodities like coffee generally move in cycles, and improving weather and capital investment to boost productivity signal lower prices are likely ahead, Gargiulo said.

Additionally, the Brazil tariff “impact” may be somewhat limited for consumers who buy from big coffee chains, Gargiulo said.

He estimates Starbucks would have to raise prices by 0.5 percent or less to recoup the full cost of Brazil tariffs, for example.

Over the longer term, consumers should brace for higher-than-average prices, analysts said.

Extreme weather that negatively impacts coffee harvests is expected to be more common, and coffee consumption worldwide continues to increase and bolster demand.