Vietnam's coffee exports reached US$3.22 billion! But exporters reported losses

Recently, according to Vietnam's Ministry of Agriculture and Rural Development, Vietnam's exports of agriculture, forestry and aquatic products reached about US $29.2 billion in the first half of 2024, an increase of 19 percent over the same period last year. Seven products with exports exceeding 1 billion US dollars include coffee, rubber, rice, fruits and vegetables, cashew nuts, shrimp and wood products.

Although the export of coffee fell, the export volume was 902000 tons, down 10.5%, but based on the average export price increase of 50.4%, the export volume reached US $3.22 billion, an increase of 34.6%.

But Vinacafe, a well-known Vietnamese coffee company, issued financial statements saying that although it made a profit in 2023, the profit was not enough to make up for its cumulative loss of more than 1.09 trillion dong (about 311 million yuan, US $42 million).

It is understood that Vinacafe Coffee Company (Vina Coffee Company) was founded in 1995, known as the Vietnam National Coffee Corporation, is the largest coffee enterprise in Vietnam, with 65 branches and 50 coffee farms throughout Vietnam, engaged in coffee cultivation, processing, transportation and import and export trade. Vinacafe produces 20-25% of Vietnam's total coffee output every year.

According to Vinacafe's audited consolidated financial statements, the company's revenue reached 2.1 trillion dong in 2023, an increase of 18% over the same period in 2022. Its main sources of income include coffee, rice and rubber, of which coffee is the main source of income.

According to the report, in 2023, the total crop area of Vinacafe increased by 9% to about 12458 hectares, and production also increased slightly to more than 29600 tons. However, the report also points out that despite the increase in production, Vinacfe did not sign new export contracts for the whole of 2023, but focused on delivering goods contracted in previous years.

Vinacafe made a total profit of more than 9 billion dong, the first time the company has made a profit since the information was released in 2021. In the previous two years, the company's profits were negative hundreds of billions of rupiah. However, as the cumulative loss is still more than 1.09 trillion dong, the profit is not enough to make up for the loss.

Vinacafe says the economy is in a difficult time. The company's coffee garden has been in operation for more than 25 years, and its productivity and coffee quality are low due to its age. In addition, the bad weather last year and this year has increased costs, while the prices of some fertilizers and gasoline have risen due to geopolitical problems, which is also a problem faced by many Vietnamese traders. In addition, due to the current high international Robusta coffee prices and the Red Sea crisis, many foreign buyers have reduced their purchases of Vietnamese Robusta coffee beans.

At the beginning of this year, Vietnam suffered the worst drought in nearly a decade, which dealt a heavy blow to the Vietnamese coffee industry and severely reduced production. Vietnam's domestic harvest for the next season is not satisfactory. And according to Vietnam's Ministry of Agriculture and Rural Development, coffee stocks in Vietnam are almost zero.

Therefore, Vinacafe called on the government to solve the climate problem as soon as possible to ensure the output and quality of coffee. However, at present, the government is planning to invest in the port and build a 50-hectare port in Batouton province in southern Vietnam at a cost of 50.82 trillion dong.

The first phase of the project begins in 2024 and ends in 2030, with investment in the construction of two berths capable of accommodating class 250000 ships. And Batouton Province is located on the international routes of Europe, the Middle East, North Asia and the Americas, hoping to build it into a powerless center and an international transit port, and conducive to the development of Vietnam's multi-industries.