27 November, 2007 - Vietnam's total coffee production for 2006/2007 increased an estimated 55 percent over the previous crop year as a result of more favorable weather and growing conditions and much better yields.
Exports for 2006/2007 reached record levels in both volume and value. Farmers continue to invest in inputs to increase yields and capitalize on current high export prices. Various government and industry efforts are underway to improve Vietnam’s coffee quality and increase its market share.
SITUATION AND OUTLOOK
Vietnam’s coffee production for 2006/2007 reached a record 1.275 million metric tons or 21.25 million 60-kg-bags as a result of more favorable growing conditions and better yields than the previous crop year. Total coffee production increased 55.5 percent over the 2005/2006 crop year. Production forecast for CY 2007/2008 is set at about 18.062 million 60 kg bag, suggesting a decline in production of 15 percent as a result of expected drier weather conditions and lower coffee yields.
The government continues its plan of encouraging farmers in marginal growing areas to switch from coffee growing to crops better suited to the soil. Coffee farmers, however, continue to expand their cultivation of Robusta, and where possible, Arabica in the face of continued high coffee prices. As a consequence, the demand for breeder coffee trees has increased considerably from previous years. Arabica coffee currently accounts for about 2.3% of Vietnam’s total coffee production.
Coffee exports for 2006/2007 also increased sharply over the previous market year. Total exports reached an estimated 19.95 million 60 kg bags, which is 54 percent more than the previous market year. Export values also increased a record 114 percent to $1.772 billion. The 2007/2008 exports are forecasted to decline around 12 percent due to anticipated lower production output levels.