NKG, the world's largest coffee trading company, enters China! It is expected to increase China's coffee exports

Neumann Kaffee Gruppe (NKG), one of the world's largest coffee traders, announced the opening of its first wholly-owned subsidiary in China to meet the growing demand for coffee beans in the Chinese market.

According to the company's announcement, NKG's China business headquarters is located in Shanghai City, and it has established coffee warehouses and distribution centers in Shanghai Yangshan Comprehensive Bonded Zone and Jiangsu Kunshan Comprehensive Bonded Zone, and established coffee cup testing laboratories to ensure coffee quality control standards.

It is understood that Neumann Kaffee Gruppe (NKG) is a globally operating green coffee bean service group focusing only on coffee. It is headquartered in Germany and has more than 60 subsidiaries and more than 3200 employees in 27 countries. It is the world's largest coffee trader.

NKG said this expansion allows it to get closer to customers, better understand needs, and provide tailor-made coffee solutions. China's coffee consumption is growing at an annual rate of 15% in a move aimed at better serving China's fast-growing coffee market and responding to the expansion of major brand chains in this market, and is committed to contributing to the growth and development of China's coffee industry. However, before NKG, many world-renowned coffee traders have established companies in China, including Olam, ECOM, Volcafe and Sucfina.

However, in recent years, problems such as multiple logistics interruptions during the epidemic, severe production cuts in coffee-producing countries due to severe weather, national governments, price fluctuations, and rising currency interest rates have caused coffee trading companies to encounter many difficulties, and even one of the coffee trading giants Mercon Coffee Group filed for bankruptcy.

NKG has also encountered many obstacles. Earlier in Kenya, due to the government's introduction of the Coffee Regulations 2019 and the Capital Markets (Coffee Exchange) Regulations 2020, the regulation of the Kenyan coffee industry changed, making it impossible for NKG to obtain related business licenses, only to stop factory operations and lay off some employees.

In addition, this year's conflict in the Red Sea region has caused global transportation to be blocked, sea freight rates have continued to rise, and transportation costs have increased significantly. As the world's largest coffee trader, NKG has recently begun to develop the Asian market.

At the beginning of this year, NKG announced the expansion of its coffee business in Indonesia and launched a new business to import, store and distribute coffee in the country, providing services to Indonesian coffee brands and roasters, hoping to import and export coffee between Asian regions, reducing shipping costs and time.

According to Chinese customs data, China exported 17,800 tons of coffee beans in 2023, with an export value of US$78 million. Nearly 70% of them were sold to Russia, 20% were sold to Hong Kong, and the rest were sold to countries/regions such as the Netherlands. Therefore, this time NKG's business in China includes the import and export of coffee products. While increasing coffee imports, it will increase China's coffee exports and enhance the international status of Chinese coffee.