Vietnam Coffee Sustainable Development Goals
Vietnam is the second largest coffee exporter in the world. At present, Vietnam's coffee production volume ranks first among coffee producing countries in the world, 1.5-2 times higher than the world's average production level. Coffee planting has solved the employment of 560,000 rural laborers, and has made great contributions to promoting the economic and social development of Xiyuan, Southeastern China and other planting areas, as well as farmers' poverty alleviation and prosperity. Among them, coffee in some provinces of Xiyuan area contributes 30% of the local GDP.
In the past 10 years, Vietnam has exported 1.2 million to 1.5 million tons of coffee each year, with an export value ranging from US$1.7 billion to US$3.6 billion, accounting for 15%-20% of the total export of agricultural products. The total export value ranks first among Vietnamese agricultural and forestry exports. 2nd place, second only to rice. There are about 150 coffee export companies and 3,000 agents in the country, 13 of which are foreign-funded enterprises.
Vietnam's coffee beans are exported to more than 80 countries and regions, and the export volume accounts for about 15% of the world coffee market share, and the export value accounts for 10%, ranking second after Brazil; the main export markets are EU member states and the United States, of which Vietnam Coffee exports to EU countries account for about 45%; Vietnamese coffee exports to the United States account for about 15%.
Vietnam has considerable production capacity for rough processing and deep processing of coffee beans. At present, special machinery and equipment for coffee processing have been localized in Vietnam and can be exported to other countries. The designed capacity for rough processing of coffee beans in Vietnam is 1.5 million tons/year, the designed capacity for roasting and making coffee powder is 52,000 tons/year, and the designed capacity for instant coffee is 36,500 tons/year. The country's 11 large-scale coffee deep processing manufacturers have a total production capacity of 140,000 tons/year, and a coffee product storage design capacity of 2.36 million tons/year. The current released capacity is about 80%.
In recent years, Vietnam's roasting and instant coffee deep processing capabilities have been continuously enhanced, and several major brands such as Vietnam Coffee (Vinacafe), Trung Nguyen, An Thai, Me Trang, and Phuong Vy have been formed. , Forming a strong export capacity. At present, Vietnam's instant coffee exports rank 5th in the world, behind Brazil, Indonesia, Malaysia and India, accounting for 9.1% of the market share.
In the past three years, the price of coffee in Vietnam has been declining continuously, while the price of pepper has risen sharply, causing coffee growers to cut down a large number of coffee trees and plant pepper trees. According to data from the Planting Department of the Ministry of Agriculture and Rural Development of Vietnam, in 2015 alone, 30,000 hectares of coffee trees have been cut across the country, of which 7,520 hectares in Dak Lak Province. At the same time, the drought and El Niño phenomenon aggravated the lack of coffee beans in Vietnam, resulting in a year-on-year decline of about 20% in Vietnamese coffee production in the past three years.
However, misfortune is a blessing. Brazil, the world's largest coffee producer, also affected by drought and El Niño, imported coffee beans from its competitor Vietnam for the first time in order to make up for the gap in market demand, which increased the price of Vietnamese coffee to a certain extent. According to statistics from Vietnam Customs, as of August 15, 2017, the average export price of Vietnamese coffee reached US$2262.8/ton, a year-on-year increase of 30.4%; the total export volume reached 974,712 million tons (down 16.4% year-on-year), while the total export value reached 22.2 Billion US dollars (up 7.9% year-on-year).
Government's goal
Vietnam’s coffee industry feeds 600,000 farmers, and the entire industrial chain involves 1 million people. However, compared with the world’s traditional coffee powers, the Vietnamese coffee industry’s competitive advantages are still not prominent. To address this issue, the Vietnamese government has issued a plan to focus on coffee planting, production and processing. In order to improve efficiency, the Vietnamese coffee industry will develop into a stable and sustainable industry.
1. The goal of industrial development
Overall goal: On the basis of the world's second highest output and export volume, Vietnamese coffee will double its export and output value, change the growth mode, improve the competitiveness and added value of coffee along the direction of modernization and diversification, and steadily achieve economic, economic, Social and environmental benefits.
2020 goal: control the total area of coffee planting to 600,000 hectares, the unit output is 2.7 tons/ha, the total output is controlled at 1.6 million tons/year, and the average output value per hectare is 120 million VND (approximately 36,000 yuan). The proportion of coffee processing has increased from the current 10% to 30%, instant and roasted coffee has reached 25% of the total output, and the export value has reached US$3.8-4.2 billion.
2030 goal: the proportion of coffee diversification and deep processing will reach 30%-40% of the output, the establishment of a strong Vietnamese coffee brand, the total coffee output value is twice the current value, and the export value will reach 5-6 billion US dollars. Continue to carry out the "Vietnamese preferential use of Vietnamese goods" campaign, and increase the proportion of domestic market sales from the current 10% to 30%. Exploit potential international markets through multiple channels to create conditions for the sale of high value-added products, especially in the markets of China, the European Union, and countries that have signed free trade agreements with Vietnam.
2. Ways to achieve
In view of the status quo and existing problems of the coffee industry in Vietnam, the Vietnamese government has formulated a development plan and has begun to build the industry in six directions:
Change the planting structure and increase the proportion of large and small coffee: reduce the planting area of Robusta coffee, and convert the land with low coffee planting efficiency to plant rubber, pepper, fruit trees and other perennial economic crops and annual crops such as cotton and hybrid corn; Areas where conditions permit expand the planting area of Arabica coffee (small seeds). Seek differentiated products and maintain competitive advantages: Give full play to the regional climate advantages, and produce high-quality organic coffee, small grain coffee, special coffee, etc. in the mountainous and ethnic minority areas in northern Vietnam. Actively carry out the authority certification of organic coffee.
Reduce production costs and improve overall benefits: Although the labor cost of the Vietnamese coffee industry is relatively low, the current planting mode is to maximize production, purchase a large number of fertilizers, and irrigation, which reduces investment benefits and increases production costs. Generally speaking, Vietnamese coffee production The cost is still high and the competitiveness is not strong. In the future, the investment structure will be adjusted to reduce investment in chemical fertilizers, pesticides, and irrigation. Instead of pursuing the highest yields, they will switch to using organic fertilizers to increase scientific and technological content to achieve considerable profit levels.
Exploit the market through multiple channels and sell high-value-added products: Fully revitalize the stocks of the Bien Hoa Coffee Factory and Nestlé (Thailand)'s Viet Nam factory, which are subordinated to Vital, to meet demand-oriented production and provide the market with products other than green coffee kernels. A variety of commodities, expand the market, and consider the development of boxed liquid coffee.
Pay equal attention to domestic and foreign trade, and innovate on the supply side: innovate trade partnerships, deepen the existing international market, establish stable trading partners in 50 countries and regions in the world, and explore the markets of China, the European Union and the countries that have signed free trade agreements with Vietnam. Add coffee to futures market transactions. Further pay attention to and develop the domestic market, and tap the potential of domestic coffee consumption in Vietnam in the context of traditional tea drinking.