Earlier, Vietnam's Ministry of Agriculture and Rural Development issued its export report for the first half of 2024, stating that coffee export volume fell 10.5% in the first 6 months of 2024, to 902,000 tonnes of coffee, but because the average coffee export price rose 50.4%, export value reached US$3.22 billion, up 34.6%.

The decline in export volume was mainly caused by lower coffee production, and the main reason for the production decrease was that Vietnam suffered drought weather in the first half of the year, causing damage to coffee trees that is difficult to repair. Secondly, competition from other fruits led to a reduction in coffee planting area, ultimately causing a sharp drop in production and demand exceeding supply in the market.

Recently, Vietnam's General Statistics Office said that the country's fruit tree area has now reached 12.711 million hectares, up 2.6% compared with the end of June 2023, of which durian reached 1.539 million hectares, up 17.4%, passion fruit reached 126,000 hectares, up 9.3%, and guava reached 272,000 hectares, up 5.6%. Growing coffee and pepper is less profitable than growing fruit, so people have switched to fruit trees, and the planting area for coffee and pepper will decrease.

Recently, the general manager of Simexco Daklak, Vietnam's third-largest coffee exporter, said in an interview with the media that previously robusta coffee and pepper prices were relatively low, so many people chose to cut down these trees and switch to growing fruits such as durian. But because this reduced coffee and pepper production and demand exceeded supply, prices also rose accordingly.

Moreover, because agricultural land is becoming scarcer while the global population continues to grow, demand for pepper and coffee has increased. Although coffee and pepper prices have now risen to high levels, with pepper reaching 100,000 Vietnamese dong/kg and green coffee beans reaching 120,000 Vietnamese dong/kg, this is still not enough to attract people to plant them again: compared with the profits of other crops such as durian, income from coffee and pepper remains much lower.

Due to drought and other weather effects in the first half of the year, coffee and pepper inventories are expected to continue declining over the next 3-5 years. In the long term, coffee and pepper market prices are unlikely to fall further.

The coffee market in Vietnam is also not optimistic at present. According to local traders in Vietnam, spot coffee trading in Vietnam is currently sluggish. The current spot purchase price for coffee is at a high level of 117 million to 120 million Vietnamese dong per ton, but many farmers have already sold out their coffee beans. Some companies, in order to fulfill previously signed contracts, bought coffee beans at high prices, but after completing delivery they are unwilling to buy coffee beans at excessively high prices.

However, there is good news: South Korea will increase its imports of Vietnamese coffee. According to reports, South Korea currently adds 4 cheap coffee shops every 3 days, and because each cup of coffee costs about 1500 Korean won (about 7.89 RMB), they are very popular locally, which has also led to the rapid growth of these coffee brands.

Due to its close geographical location, South Korea will increase its imports of Vietnamese coffee. In 2023, South Korea imported 4.145 million tons of Vietnamese coffee, with an export value of 9335 million USD, an increase of 17.9% compared with 2022 , and the export value in 2024 is expected to reach 22 million USD.