Vietnam Coffee Introduction: The position of the coffee industry and the role of Vietnam coffee exports

Vietnamese Coffee Exporter
Vietnam Coffee Introduction The position of the coffee industry and the role of Vietnam coffee exports

Vietnam Coffee Introduction: Popular Vietnamese street cafes use rudimentary aluminum drip filters. Traditionally, coffee is brewed in separate parts employing a filter, including a small cup, a filter compartment, and a lid that doubles as a container to catch fragrant black coffee cups. Learn more about Vietnam Coffee Introduction with Helena coffee Vietnam.

Overview of Vietnamese coffee Introduction

The Vietnamese like their coffee nice and slow, and setting up the filter and choosing the right drink time is an art. When the coffee is good, you’ll want to make it last. Preparing the coffee this unhurried way forces you to slow down and savor the experience. Watching the coffee drip stokes your desire and forces you to sit for a few minutes while the coffee brews.

Vietnam Coffee Introduction
Vietnam Coffee Introduction: Phin Filter Coffee with condensed milk – A Vietnamese Coffee Culture

While all Vietnamese coffee is not prepared this way, the classic slow drip method is a real treat and a reminder to chill and enjoy conversations. This is especially welcome advice in the all-encompassing hustle and bustle of life in the heavily populated Vietnamese cities.

Origin of Vietnamese coffee

About 1000 years ago, an Ethiopian nomad accidentally discovered the excellent taste of a strange plant that made people feel strangely refreshed and alert. Since then, this fruit has become everyone’s drink and took the name of the Cafe village where this tree was discovered as the name for the tree.

From the sixth century, coffee became the drink of all Ethiopians and quickly spread to the Middle and Near East.

Vietnamese coffee history

By the early 16th century, coffee began to appear in Europe and gradually spread to Asia and Oceania. In 1857 coffee trees were planted in Vietnam by Catholic missionaries, first produced in some churches in Ha Nam, Quang Binh… Then grown in plantations in the Northern Midlands and North Central regions. The set. Since then, the coffee area has been expanding.

From 1994 to now, Vietnamese coffee trees, especially Robusta coffee, have increased and achieved results in many aspects. Currently, coffee is the second largest exported agricultural product in Vietnam. In the current agricultural industry, coffee is second only to rice and has a solid foothold to become a vital production industry in the national economy.

Vietnamese coffee bean types

As we all know, there are more than 70 different types of coffee worldwide. Still, people mainly cultivate two main coffee groups, Robusta and  Arabica, thanks to yield and quality advantages. The quality also depends on the adaptive characteristics of each plant.

  • Arabica

When you taste many types of coffee, you will find the taste of Arabica sour. This is also considered a distinctive feature that no other coffee can match. But immediately felt the bitter taste of the peel. The way to handle the sour taste of coffee is the same.

Arabica coffee prefers a cool climate with cold tolerance, usually grown at about 1200m. Arabica has much foliage, ovate or lanceolate. The fruit of the type of Arabica is egg-shaped or round, bright red; some varieties are yellow when ripe. This coffee is mainly grown in Brazil and Colombia, with an aroma popular in many countries.

Arabica Coffee is suitable for the northern midland mountains, concentrated in Son La, Lai Chau, Thanh Hoa, Nghe An, Quang Tri, and Thua Thien Hue. The area of ​​Arabica nationwide in 2003 was 30,000 ha. Arabica is better quality but more susceptible to pests and diseases, so the yield is also lower by about 0.9-1.2 tons/ha.

Remarkably, Arabica grown in the higher area produces better quality coffee beans. The persistent flavor also becomes more profound than that of lowland Arabica.

  • Robusta

So when you use it, you will feel a strong bitter taste. Most people like the bold taste in Vietnam, so coffee with high Robusta content is prevalent. In the Robusta line, there are also wide varieties. But most people are directing their attention to solid bitterness without impurities. Robusta beans are recognizable to the naked eye because it has round seeds, much darker in color than Arabica beans.

Robusta coffee is grown in most of Central Highlands and Southeast Vietnam. These are the country’s two main coffee production areas with high yields (over 1.6 tons of kernels/ha) of good quality, with an area of ​​443,000 hectares, accounting for 86% of the country’s size.

  • Peaberry Coffee

Peaberry Coffee only has mutant coffee beans on a single-core plant, so it can’t be mixed up anywhere. People separate the type of Lollie seeds because of their particular shape. The quality of Culi compared to other sources may be better than that of ordinary seeds. Culi Robusta seeds have a more pungent bitter taste than standard Robusta beans. Culi Arabica seeds have a more sour flavor than regular Arabica beans.

  • Moka 

The 100% original Moka coffee cups will bring a slightly bitter taste. Those who know how to enjoy it will first feel the difference.

When drinking, you will feel a little sour and fatty taste of the oil inside the coffee beans. When drinking, the bitterness spreads in the mouth and down the throat, increasing the attractiveness of coffee. But only a few seconds after, the passionate scent and sweetness appear.

  • Catimor

When enjoying, you will see the light bitter taste mixed with a delightful sour taste. It gets that flavor because the Catimor coffee beans cross between the Timor coffee variety and the Catimor coffee variety. But, Catimor has a lower caffeine content than purebred Robusta. From there, its bitterness will not be equal to Robusta coffee.

Where are Vietnamese coffee beans from?

We must mention the Central Highlands as the “headquarters” of coffee trees. The Central Highlands is famous for coffee with places such as Dak Lak and Lam Dong. Buon Ma Thuot coffee shop in Dak Lak is one of the enormous coffee granaries in the world.

 The Central Highlands is blessed with rich basalt-red soil. When it comes to basalt soil, everyone knows that it is good soil, very porous, has good water holding capacity, and especially this type of soil is straightforward to absorb nutrients. But, the Central Highlands is a mountainous area (500-600 meters above sea level). This place has a lot of rain and a cool climate all year round and is very suitable for the living conditions of coffee trees, especially Robusta coffee.
Vietnam Coffee Introduction
Vietnam Coffee Introduction: The Central Highland in Vietnam
Do you know where the “coffee capital” is? That is Buon Ma Thuot. Buon Ma Thuot is one of the first lands chosen by the French to grow and propagate coffee trees. Before choosing Buon Ma Thuot, the French surveyed this land and found that this was a “paradise” for growing coffee. From the soil to the climate, the ancient alluvial layer, and especially the mountainous terrain. They are all very suitable for coffee trees.
They chose Buon Ma Thuot as the center and specialized in cultivating Robusta coffee varieties within a 10km radius around Buon Ma Thuot. Famous coffee places such as Ea Kao, Cu But, Tan Lap were built, etc. To increase the strength of coffee, people often raise the proportion of Robusta varieties when producing. And Robusta in this region is always the preferred choice because it is very suitable.

Comparative advantage in coffee production and export in Vietnam

Comparative advantage in coffee production.

  • Advantages of natural conditions

Vietnam is located in the tropical belt of the Northern Hemisphere, stretching along the longitude direction from 8o 30′ to 23o 30′ north latitude. Climatic, geographical, and soil conditions suitable for coffee development have given Vietnamese coffee a unique taste.

About the climate:

  • Vietnam is located in the tropical belt; the climate is sunny, with lots of rain every year. Rainfall is evenly distributed among the months of the year, which are the months when coffee grows.
  • Vietnam’s climate is divided into two distinct regions. The southern environment is the hot and humid tropical climate suitable for Robusta coffee. The northern climate region has cold and drizzly winters, ideal for Arabica coffee.

About land:

  • Vietnam has red basalt soil for coffee trees distributed throughout the territory, concentrated in the Central Highlands and Southeast, with millions of hectares.
  • Thus, coffee plants need two essential elements, water, and soil, available in Vietnam. This gives Vietnam an advantage that other countries do not have.
  • Labor advantage

Vietnam has a population of 80 million, of which 49% are working age. This is a reasonably large labor force, providing for all activities in the national economy. Producing coffee for export is a process that includes many stages, starting from researching, selecting varieties, planting, caring, purchasing, processing, preserving, packaging, and exporting. This process requires a sizable workforce.

Especially in Vietnam, the application of machinery to coffee production and processing is not much, so the advantage of labor can help Vietnam reduce costs for export coffee production. Lowering costs helps Vietnam to be competitive in price compared to other countries.

It is estimated that coffee production for export attracts many workers: 1 hectare of coffee draws from 120,000 to 200,000 workers. There are currently about 700,000 – 800,000 coffee production workers in Vietnam, especially when caring for and harvesting. This number is up to more than 1 million people. Thus, with such a large labor force as Vietnam today, it can provide a large number of workers for the coffee industry.

– Coffee productivity: Vietnamese coffee has a high yield: The average coffee yield in the world is 0.55 quintals/ha; in Asia, it is 0.77 quintals/ha, and in Vietnam, it reaches 1.2-1.3 tons. / ha. From 2000-2004, the average yield reached 2 tons/ha; some years reached 2.4 tons/ha. This high yield is because Vietnam has good varieties and favorable factors in terms of soil and climate, especially since Vietnamese people have long experience in coffee cultivation.

– Vietnamese people have the virtue of hard work, the spirit of learning and absorbing science and technology to apply in growing and processing coffee for export. This is also an advantage in creating a source of goods for export coffee.

Vietnamese coffee has a delicious natural flavor. Vietnamese coffee is grown in highlands and high mountains with suitable climates and soil. This condition gives Vietnamese coffee its own special flavor that other countries do not have. This is a great advantage of Vietnam because coffee is a drink used to enjoy, sometimes it also shows the level of people in society, so the taste of coffee is always an attractive factor for customers, especially difficult customers.

– One of the subjective advantages is that the economic reform policy of the Vietnamese Party and State has created a favorable environment for the development of coffee production. Resolution 09/2000/NQ/CP of the government defining the planning and development orientation of Vietnam’s coffee trees up to 2010. Therefore, from 2003, coffee production must follow the government’s master plan and plan. In terms of area, variety, output, and quality, the country can overcome the situation of spontaneity, intellectualism, and movement. Therefore, farmers are encouraged to plant coffee with peace of mind. In addition, the State also has the policy to support prices when the price of coffee in the world market is low.

Comparative advantage in coffee exports

State strategy: From 2003-2010, the State perfected strategies for Vietnam’s essential export agricultural products, in which coffee is considered the No. 1 essential commodity. That position is derived from the advantages of land, climate, and production experience of farmers. This advantage, combined with a stable political and social regime, mechanisms, and policies in the doi moi period, confirmed in the economic policy set out by the IX Party Congress, has strengthened Vietnam. The South integrates into the world and regional economy.

The world demand for coffee is increasing and increasing rapidly. Coffee is a popular beverage in all walks of life. Currently, the need for coffee exceeds the two traditional drinks, tea and cocoa. This has promoted and encouraged coffee-producing countries to export.

Regarding the cost of producing coffee for export: the cost of making coffee for export in Vietnam is lower than that of other exporting coffee-growing countries. The average cost in Vietnam is 650-700 USD/ton of green coffee. If processing costs are included, the cost for a ton of coffee for export is 750-800 USD. Meanwhile, the production cost of India is 1,412 million USD/ton for tea and 926.9 USD/ton for coffee with jasmine. Low production cost is a favorable condition to lower prices and increase the competitiveness of Vietnamese coffee in the world market.

Vietnam has joined the ICO and will join the Association of Coffee Producing Countries (ACPC) and other relevant international organizations. Vietnam has strengthened economic, trade, science, and technology cooperation and human resource development. This can help Vietnam have the conditions to learn and exchange experiences in coffee production and processing and, simultaneously, expand the exchange of coffee products with countries in the region and the world.

  • Regarding the coffee export market: Vietnam’s coffee export market is expanding, and several high-quality coffee products such as Trung Nguyen, Vinacafe, Nam Nguyen, Thu Ha, etc. have brands. And stand firm in the regional and world markets.
  • Regarding planning: Vietnam has built and planned many coffee growing areas for export with high yield and good quality, such as the Central Highlands, the Southeast, and some central provinces. This is a great advantage in creating a source of goods for coffee export needs.

The position of the coffee industry in the national economy

Coffee is one of Vietnam’s essential export commodities, the second largest agricultural export in terms of turnover after rice. Therefore, the coffee industry has played a massive role in the national economy.

The position of coffee in the agricultural sector of Vietnam.

The coffee industry contributes to the restructuring of crops in Vietnam’s agricultural sector. If in past Vietnam was a country known for its rice product, today Vietnam is also known for another commodity which is coffee. This not only helps people diversify the structure of crops in the agricultural sector but also diversifies the products in the export of Vietnam’s agricultural products.

  • Diversification of business services in the agricultural industry: coffee production is associated with coffee processing. Therefore, agricultural production services have been developed, such as plant variety research services, pesticide and fertilizer supply services, and machinery and equipment supply services for drying and processing. Coffee, packaging services, export consulting services…
  • Redistribution of labor resources in agriculture. In the past, Vietnam’s agriculture was mainly employed in the wet rice industry. This is seasonal labor, so there is an enormous surplus of work in the idle period. The development of the coffee industry entails a large amount of labor to serve it. With the scale of the coffee-growing area expanding, a large labor force is needed. This creates regular jobs for people in mountainous regions and rice-growing plains, creating more income for them, and limiting social evils.
  • Limiting abandoned lands: Because the characteristics of coffee trees are suitable for the highlands, and high hills, where they have not been fully exploited… Therefore, the abandoned lands have been limited. Greening bare ground and bare hills.

The position of the coffee industry in the national economy

The coffee industry contributes to economic restructuring: the coffee industry is associated with a closed process from production to consumption.

This entails a series of economic development sectors, such as the construction of facilities for seed research, irrigation, transportation, machinery manufacturing, etc., thus accelerating the process of structural transformation. The economy in regions where coffee trees grow. This contributes to speeding up the process of industrialization and modernization in agriculture and rural areas.

The coffee industry has contributed greatly to the state budget revenue. Annually, the coffee industry brings the country 1-1.2 billion USD/year, accounting for 10% of the country’s export turnover.

Contributing to solving jobs and improving people’s lives:

The role of coffee exports in the national economy.

The trend of globalization and integration is taking place like a hurricane worldwide, attracting many countries worldwide to participate. Vietnam can not stay out of this vortex and is making significant efforts. Do your best to get into this process as quickly as possible. Import and export activities will be a vital bridge to accelerate this process.

Therefore, export activities are increasingly important in Vietnam’s economic development policy and strategy. Coffee is one of the essential export commodities in Vietnam. Developing export coffee production will significantly contribute to Vietnam’s economy. Let’s look at the role of coffee exports in Vietnam’s economy.

Positive roles of Vietnam coffee exports

Export creates the primary source of capital for imports to serve the country’s industrialization.

The country’s industrialization following appropriate steps is an inevitable way to overcome our poverty and underdevelopment. To carry out industrialization and modernization of the country requires a considerable capital source to import machinery, equipment, techniques, advanced technology, and management level from foreign countries. Sources of capital for import can be from foreign investment, debt collection from tourism activities, and export of other goods. However, loans and investment capital from abroad must be paid in one way or another. An essential and sustainable source of money is revenue from export activities. Exports determine the size and growth rate of imports.

Vietnam Coffee Introduction: Robusta Coffee Tree in Coffee Farms

However, exporting is not an easy operation. Each country must find the most profitable export products to ship successfully, bringing the highest benefits. Therefore, each country must develop its policy for essential export products. Understanding this, Vietnam has also built its key export policy. These items will create Vietnam’s primary source of budget revenue. Coffee is the main export commodity of Vietnam. Annually, the coffee industry contributes a significant turnover to the state budget. The turnover from coffee export is about 1-1.2 billion USD, accounting for about 10% of the country’s export turnover. In the early stages of industrialization and modernization, Vietnam needs significant capital to invest in basic construction and import machinery and technology abroad.

Coffee exports contribute to economic restructuring to promote product development.

Vietnam has a massive advantage in coffee production. Every year, Vietnam produces a large volume of coffee. However, Vietnam’s domestic coffee consumption is deficient. Therefore, the world market is an essential direction for organizing production. Today, the world’s structure of production and consumption has changed drastically due to the modern scientific and technological revolution. The economic restructuring in the process of industrialization in line with the development trend of the world economy is inevitable for Vietnam.

There are two ways of looking at the impact of exports on production and economic restructuring:

  • First, export is just the consumption of surplus products due to production exceeding domestic demand. The show is not enough for consumption; the economy is still backward and underdeveloped like ours; if only passively waiting for the excess production, exports will still be small and grow slowly. Production and economic structural change were prolonged.
  • Second, consider the market, especially the world market, as an essential direction to organize production. This view comes from the world’s need to manage the exhibition. This has a positive impact on economic restructuring and promotes production development.

As for the coffee industry, Vietnam’s coffee production is significant, and domestic demand is minimal because Vietnam has a tradition of enjoying tea. Therefore, in the Vietnamese market, there will be a situation where the supply of coffee exceeds the demand for coffee, so it is necessary to boost exports. However, Vietnam does not consider coffee a waste product that needs to be exported but comes from the world market that increasingly consumes more coffee. Therefore, the world market is always a target for coffee-producing enterprises. This contributes to a substantial shift in the economic structure of Vietnam and promotes production development. Show :

– First of all, coffee production for export will lead to economic development, such as processing and machinery manufacturing industries, promoting primary construction industries such as road construction, schools, and coffee purchasing stations;… In addition, a series of developed service industries, such as the provision of plant varieties, plant protection drugs, banking, machinery, equipment rental, and ethics, contribute to the transformation of Vietnam’s economic structure towards export.

Coffee exports create the possibility of expanding consumer markets, contributing to product development and stability. Export activities are associated with finding export markets, so we have a large consumption market when exporting is successful. This not only gives Vietnam a position in the international market but also gives Vietnam the initiative in production to meet the world’s coffee consumption needs. The larger the consumption market, the more it promotes the development of products to meet the source of goods for export.

Coffee exports create conditions to expand input supply for production and improve domestic production capacity. Like any other export commodity production industry, coffee production for export also creates conditions to raise the capital, technology, and management level and improve workers’ lives to ensure reproducibility—Expanded export.

Export creates economic and technical premises to improve and enhance domestic production capacity. Coffee export is an essential means of starting capital and technology from the outside world in Vietnam. Exporting coffee will allow Vietnam to grasp the world’s advanced technology to apply in its country. Such as coffee processing technology for export, technology, drying, and post-harvest preservation of coffee, in addition to learning management experience from other countries. This will improve the domestic production capacity to match the world level.

– Through export, Vietnamese coffee will participate in the world competition in terms of price and quality. This competition requires us to reorganize production and form a production structure that continuously adapts to the market. Producing coffee to meet market demand and then firm in the market, coffee exporters must do er prices and improve quality to knock out competitors.

Exporting coffee requires businesses always to innovate and perfect production and business technologies to promote products and expand markets. Market share is always the goal of coffee exporters, thus forcing them to be active in technological innovation, advertising, and entering the world market.

Exports have a positive impact on creating jobs and improving people’s lives. Producing coffee for export will attract millions of laborers to work and earn high and regular incomes.

With a country of 80 million people, and a relatively high working-age population accounting for about 50%, the development of coffee will attract a large labor force, reducing the burden of unemployment for the country. . Helping people stabilize their lives, and reducing social evils. At the same time, helping people have a high income is a condition for them to absorb science and technology and integrate with the development of the world.

Coffee exports are the basis for expanding and promoting Vietnam’s foreign economic relations.

Exporting is the exchange of trade with foreign countries, so when shipping, there will be conditions to help that country have many relationships with other countries. We have exported coffee to 53 countries worldwide, allowing Vietnam to have many development cooperation relationships. This is essential for Vietnam to have multilateral and bilateral cooperation relations to accelerate the process of Vietnam’s WTO accession.

In addition, the growing coffee tree contributes to the restoration of the ecological environment, greening the bare land and barren hills after severe degradation due to the destruction of nature and destruction by human hands.

Adverse problems of Vietnam’s coffee export

Today’s most significant problem in Vietnam’s coffee exports is that sustainability is not high. Although export output has increased rapidly in recent years, prices have not been stable, so export turnover has increased slowly or decreased.

This problem is related to production, processing, and export in which the spontaneity of output leads to oversupply, and post-harvest processing and preservation work has not met the requirements of increasing production and improving the quality of products, quality of the coffee export market is not stable.

Coffee production lacks planning and planning.

The spontaneity and fragmentation not associated with the market are typical, leading to oversupply, falling prices, and reducing producers’ income, making it difficult for state-owned enterprises to export coffee.

Vietnam Coffee Introduction The position of the coffee industry and the role of Vietnam coffee exports
Vietnam Coffee Introduction

In recent years, the State has planned to develop coffee production. However, there are still many places where people cultivate spontaneously, thus making the coffee industry unable to manage coffee output, leading to a shortage of coffee. The supply situation exceeded demand and pushed prices down, making coffee-specialized regions unable to cover production costs, leading to significant losses.

The production structure is unreasonable, focusing too much on Robusta coffee while not paying attention to expanding Arabica coffee, a coffee favored by the market with high prices.

Robusta coffee is grown popularly in Vietnam, but the world prefers to consume coffee and tea. This poses the problem for Vietnam that if the structure of coffee is not changed correctly, it will lead to an overabundance of coffee products but a shortage of Arabica Coffee Beans. This is a significant disadvantage for Vietnam’s coffee exports.

The low quality of coffee is not commensurate with the advantages of Vietnam’s land and climate, and it is far from the requirements of the world market.

The trend of chasing productivity and output has made many business households interested in coffee quality, making coffee prices much lower than world coffee. Vietnamese coffee has many impurities, unripe coffee, and outdated drying technology, leading to mold that reduces coffee quality. Especially, Vietnamese businesses have not exploited the advantages of Vietnamese coffee because of the taste of this item.

There are many shortcomings in the management and purchase of coffee.

The Coffee Association only manages a part of coffee production enterprises, mainly under the Vietnam Coffee Corporation, while private traders control the majority of household coffee.

Why should you choose Helena Coffee Vietnam?

Helena Coffee Processing & Export in Vietnam | Helena., JSC, established in 2016, is a Vietnamese coffee exporter. After years of growth, we have become one of Vietnam’s most well-known coffee production and export enterprises. Our products are now exported and consumed in various countries and areas worldwide, including China, Taiwan, Thailand, Singapore, Ukraine, and the United States.

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