In 2022, the global coffee price level tended to recover strongly compared to 2021, especially during the supply shortage period. However, by the fourth quarter, coffee prices dropped sharply due to the impact of high-interest rates and the world economic recession.
According to a report by the US Department of Agriculture (USDA), global coffee production is forecast to increase by 6.6 million bags from the previous crop year to 172.8 million bags in the 2022-2023 crop mainly because Brazil's arabica coffee trees enter the harvest year according to the biennial production cycle.
According to the International Coffee Organization (ICO), global coffee exports reached 10.2 million bags in November 2022, an increase of 9.2% over the same period in 2021. It was accumulated in the first two months of the 2022 crop year. In 2023 (October and November 2022), the global coffee trade reached 19.6 million bags, an increase of 1.6% over the same period in the 2021-2022 crop year.
The coffee market in 2023 is forecast to face many difficulties. Coffee prices are under pressure due to weak demand when affected by the economic downturn while supply is large.
The Coffee-Cocoa Association (VICOFA) said that coffee production in the 2021-2022 crop year (from October 1, 2021, to September 30) is estimated at 1.73 million tons, a slight change compared to the crop year before. However, the total planted area remains unchanged, at about 600,000 hectares.
According to data from the General Department of Customs, Vietnam exported nearly 1.8 million tons of coffee to the world market in 2022 with a turnover of more than $4 billion, up 13.8% in volume and 32 % in value compared to 2021.
In 2022, Vietnam's coffee export price 2022 recorded the highest level in many years, with an average of 2,282 USD/ton, up 16% compared to 2021.
Profit after tax of coffee businesses tends to decline sharply over the same period; even some companies have heavy losses. In addition, the cost of capital, interest, and operating expenses increased sharply due to inflation and the Russia-Ukraine conflict, ... which are the leading causes of eroding the profits of coffee businesses.
Read more: AGRICULTURAL PRODUCTS INDUSTRY REPORT