According to Vietnamese media reports, although Vietnam was earlier hit by two tropical storms in succession, "Yagi" and "Soulik," which did not seriously affect Vietnam's main coffee-producing regions, they caused heavy rainfall in many parts of Vietnam, and the heavy rainfall caused upstream water to surge in and the tide to rise, making flooding at the headwaters of the Mekong River increase sharply, and flood warnings were issued in many places across Vietnam.

According to Vietnam's National Center for Hydro-Meteorological Forecasting, flooding in the upper reaches of the Mekong River is increasing rapidly, and in the coming days, upstream flooding combined with rising tides will cause water levels in the upper Mekong to continue rising rapidly. Therefore, the forecasting center warned that low-lying areas, riverside areas and areas outside dikes in the downstream region of the Mekong Delta are at risk of flooding, and that prevention and control work for landslides and weak dikes is needed.

The Southern Institute of Water Resources Planning of Vietnam assessed that, due to the heavy rain caused by Typhoon "Yagi" on the Mekong River, flooding is trending upward and has now spread to areas in Cambodia and Laos, causing water levels to rise substantially over the past days. There is currently great concern that in these downstream areas of Vietnam, where crops such as coffee, fruit and rice are mainly grown, if heavy rain increases and causes heavy rain in the upstream basin, triggering floods flowing into the Mekong Delta, southern and western Vietnam will suffer damage and lower productivity, bringing serious losses.

It is understood that southern and western Vietnam are Vietnam's main Robusta producing regions, and Vietnam's 2024/25 coffee harvest is about to begin in October, but since the start of this year the area has been suffering from drought, and the hot, dry conditions and water shortages have seriously affected Vietnam's coffee flowering period, with some coffee plants withering and their leaves turning yellow and falling off. By September, Vietnam was hit by two tropical storms in succession, and even though these two storms did not directly strike the coffee-producing regions, the heavy rainfall they brought also knocked some cherries off the trees, causing reduced yields, and the floods that are now about to arrive will impact and damage Robusta coffee planted in low-lying areas, and this year will continue the trend of declining production.

According to the Buon Ma Thuot Coffee Association of Vietnam, extreme climate and a reduction in planted area will cut Vietnam's 2024/25 new crop by about 10%-15%. Drought not only reduces coffee cherry yields, but may also leave the cherries lacking in nutrients, resulting in smaller bean size, which together contribute to the decline in production.

In addition, according to the latest data from Vietnam's Ministry of Agriculture and Rural Development, Vietnamese fruit is growing at a steady double-digit rate this year, hitting a new high, with durian performing especially well. According to statistics, in the first 8 months of 2024, Vietnam's durian export value was close to 1.82 billion US dollars, up 45% year-on-year, and it is expected that Vietnam's durian export value could reach 3.5 billion US dollars this year. Because durian is more profitable than coffee, in recent years many coffee farmers have switched to growing durian and avocado, causing Vietnam's coffee planting area to keep declining.

Moreover, tropical storms have brought considerable impact to Vietnam's ports, with infrastructure at some ports severely damaged, causing loading and unloading operations to come to a complete halt. Goods in some companies' warehouses were lost and destroyed due to the typhoon, and a large number of containers piled up at the ports, making it difficult for goods to move in and out. This is unfavorable for Vietnam's exports of coffee and other goods, and serious incidents such as cargo theft had occurred previously. These events have led other traders to reduce their purchases of products from Vietnam, causing Vietnam's international influence in production to decline somewhat.

International trader Volcafe likewise stated that, due to the decline in Vietnam's coffee production, global robusta coffee supply is expected to remain in shortage in the 2024/25 season, and this will be the fourth consecutive year of shortage. This is because in Indonesia, another major robusta country, although weather conditions have had relatively little impact on coffee production, the sharp increase in tourism after the pandemic has also increased domestic demand for coffee in Indonesia, causing exportable volumes to keep declining.

According to the Indonesian Coffee Exporters Association, production in the 2024/25 season is expected to reach 10 million bags, up 14% from last year, but due to the surge in local coffee consumption, the volume available for export is expected to be around 250,000 tons, flat with last year, yet still trending downward.This news is pushing up the price of robusta futures, which has now reached5311 US dollars/ton, a high level. Some experts believe that, given the current various circumstances, the price will remain high until2025 early next year.

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