Vietnam’s coffee exports plummet as robusta prices fall
Vietnam exported 943,000 tonnes of coffee worth 1.6 billion USD in the first half of 2019, representing decreases of 9.2 percent and 19.9 percent year on year, respectively.
Exports of coffee in the first six months falls by around 20 per cent year-on-year. (Photo: VNA)
Hanoi (VNA) – Vietnam exported 943,000 tonnes of coffee worth 1.6billion USD in the first half of 2019, representing decreases of 9.2 percentand 19.9 percent year on year, respectively.
In Junealone, the country shipped abroad 165,000 tonnes of coffee, raking in 274million USD, reported the Ministry of Agriculture and Rural Development (MARD),saying that most markets except the Philippines reduced purchases.
The sharpfall in export earnings was caused by the price of robusta coffee falling inLondon due to a global glut, with Vietnam getting the lowest rates of all exporters.
Around 80percent of Vietnam’s exports comprise of raw beans, which do not always meetripeness requirements and are occasionally contaminated by impurities.
Exporterssaid around 80 percent of coffee exports are done using a method in which theysign a sales contract, receive a certain proportion of the contract valuebeforehand, and deliver the products after harvest (also called differential).
The priceis decided by rates fixed on global coffee trading floors at the time ofdelivery.
But Vietnameseexporters are often forced to sell at cheaper prices because of thisdifferential business model in addition to the unstable quality oftheir products when compared with international benchmarks.
Expertshave suggested businesses to move away from this business model to reducethe reliance on global prices.-VNA
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Exports of coffee in the first six months falls by around 20 per cent year-on-year. (Photo: VNA) 
