Vietnamese organic coffee exported to Japanese market

Da Chais - Potential for organic coffee development in ethnic minority areas Exports skyrocket, domestic coffee prices may reach 100,000 VND/kg

The coffee market in 2024 continues to be hotter than ever since after Tet until now; coffee prices have continuously fluctuated in an upward direction and are currently heading straight towards the 100,000 VND/kg mark. While coffee prices are increasing, Vinh Hiep Company Limited does not chase quantity but focuses on improving quality by investing in the development of organic coffee, bringing 45% higher value than regular coffee.

Reporter of Cong Thuong Newspaper had a conversation with Mr. Thai Nhu Hiep, Director of Vinh Hiep Company Limited, and Vice President of Vietnam Coffee and Cocoa Association (Vicofa) about this issue.

Cà phê hữu cơ Việt Nam xuất khẩu vào thị trường Nhật Bản

Mr. Thai Nhu Hiep, Director of Vinh Hiep Company Limited, Vice President of Vietnam Coffee and Cocoa Association (Vicofa)

Vietnam is currently the second largest coffee exporter in the world, but it mainly exports regular robusta coffee, while the world trend is favoring “green” coffee, that is, organic coffee. So how is the development of organic coffee in Vietnam today and has the brand become known to the world, sir?

The world has shifted towards a green, clean lifestyle and organic coffee is the choice of many consumers around the world. Data from Data Bridge Market Research shows that the global organic coffee market was worth USD 6.8 billion in 2021 and is expected to reach USD 12.96 billion by 2029, with a CAGR of 8.40% during the forecast period 2022-2029.

Despite the large market potential, the current development of organic coffee in Vietnam is very low, accounting for only nearly 2% of the total global output. The main reason is that Vietnamese farmers are familiar with traditional farming methods, using inorganic fertilizers to increase productivity and output.

However, there is a positive sign, although occupying a small market share, the world has known the brand of Vietnamese organic coffee in general, Vinh Hiep organic coffee in particular. Because we have pioneered in building quality coffee, investing in farms according to the organic coffee processing model to meet the market trend as well as our life moving towards a green and clean environment.

Having been involved in the coffee industry for many years, can you tell us where Vietnamese coffee is on the world map?

With our experience and assessment, Vietnam is currently leading in terms of both quality and quantity of Robusta. Therefore, Vietnam is playing an important role in the global supply of Robusta coffee. In particular, the shortage this year has also affected the price, because the whole world needs to use Vietnam's Robusta source.

In terms of brand, Vietnamese Robusta coffee is number 1 in the world. However, as I said above, following the world's green development trend, to calculate long-term, to be sustainable and have a brand, businesses and farmers have now joined together to build a green agricultural chain, creating a supply chain with control and traceability, following international criteria and achieving certifications such as Fair Trade, Organic, Rain Forest, 4C...

The first batch of Vinh Hiep organic coffee is exported to the Japanese market.

Currently, coffee prices are high, causing many people to chase after price and quantity, so why did Vinh Hiep choose to invest in organic coffee?

It must be clearly stated that the current high coffee price is due to a global shortage of supply. Specifically, this year's output has decreased due to the impact of climate change, in which Vietnam's coffee crop has also failed, leading to a shortage of nearly 20%. However, this is a short-term fluctuation.

In addition, a number of coffee growers have switched to high-income crops because coffee at the old price does not bring productivity or profit to farmers, so it is reasonable that the market in general and farmers in particular are adjusting prices.

Therefore, I affirm: It is not true to say that high-priced coffee will follow the price without paying attention to quality. The high price is due to supply and demand shortage, leading to local shortages and price increases, not ignoring quality. The higher the price, the better the quality of the product.

For example, our company is currently a pioneer in linking with farmers to produce sustainable agriculture to improve the quality of coffee. This model has been oriented and built by us since 2016. We have invested in an organic farming model with the orientation of developing sustainable agriculture, green agriculture as well as quality products to affirm and improve the value of coffee trees.

It is known that today (March 19), the first batch of Vinh Hiep organic coffee was exported to Japan - a market famous for the strictest standards in the world. Could you tell us what processes the company went through to enter this market?

From the beginning in 2016 until 2022 - that is, after 8 years, we were able to launch the product. Then, to open the market, it took us 2 years of negotiation to successfully sign a cooperation agreement to export the first 2 containers of organic coffee to the Japanese market. The good news is that this shipment has opened up new opportunities for the development of our organic coffee in the Japanese market in the near future.

After Japan, in the upcoming plan we plan to continue expanding the market in some countries in Asia and the US. To do this, we will cooperate with cooperatives and farmers to replicate the model that has been done in the past 8 years because this is the destination to reach in the journey of sustainable development.

Thank you!

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