Coffee exports to the EU reached a new high in the first half of 2022 as a result of EVFTA

DNHN - Increasing coffee exports to the EU, according to the Ministry of Sector and Trade, would help the industry expand gradually and solidify its position in the global market. Since its implementation, the EVFTA Agreement has reduced tariffs on numerous Vietnamese coffee product lines to zero per cent, allowing the Vietnamese coffee sector to enhance value and extend market share in the EU.

In which the quantity of coffee shipped from Vietnam to major EU countries has climbed significantly, with Germany up 13.9 per cent, Italy up 13.5 per cent, and Spain up 47.5 per cent... The quantity of coffee shipped to Belgium climbed by more than 3.2 times, while the amount exported to the Netherlands increased by 3.7 times.

The European Union is presently our country's biggest coffee export market, accounting for more than 40% of total industry exports. As a result, coffee exports to this market surged dramatically, helping Vietnam's total coffee exports in the first half of this year to 1 million tons, worth 2.3 billion USD, a rise of 20.7 per cent in volume and 20.7 per cent in volume. In terms of value, 48.5 per cent.

Vietnamese coffee has the potential to reclaim market share in the EU.

The EU is the world's biggest coffee consumer market and a prospective market for coffee exporting nations such as Vietnam.

According to the International Trade Center (ITC), the EU accounts for 47-49 per cent of the total value of global coffee imports between 2017 and 2021, with an average growth rate of 3.7 per cent per year and a turnover of USD 15.7 billion every year. EU coffee imports, in particular, are increasing, reaching $17.3 billion in 2021, the highest level since 2011.

Vietnam ranks second in terms of coffee exports to the EU after Brazil, but its coffee market share in the EU has significantly declined in recent years, falling from 9.7 per cent in 2017 to just 6.2 per cent in 2021.

As a result, the EVFTA Agreement is anticipated to assist Vietnam in regaining its position and market share in the EU shortly. In reality, from the beginning of 2022, firms have taken greater use of the EVFTA benefits to increase coffee exports to the EU market.

The EVFTA is now approaching the implementation phase in its third year, with more broad tariff obligations, which will benefit Vietnam's coffee exports to the European Union.

Apart from the benefits of the EVFTA Agreement, Vietnam's coffee exports to the EU benefit from other variables such as increased coffee quality and decreased supply chain congestion.

Furthermore, the fall in global coffee production in 2022, particularly in rivals such as Brazil, Colombia, and Peru, gives significant prospects for Vietnamese coffee exporters. Nam reclaims market share in the European Union.

According to a recent US Department of Agriculture (USDA) prediction, EU coffee imports in the 2021-2022 crop year would grow by more than 1.1 million bags compared to the 2020-2021 crop, reaching 45 million bags.

At the same time, this figure is predicted to rise by 1 million bags in the 2022-2023 crop to 46 million bags, accounting for 40% of the world's imported green coffee. Brazil, Vietnam, Uganda, and Honduras are among the top suppliers.

The USDA also predicts that EU coffee consumption will reach 42.9 million bags in the 2022-2023 harvest, up 0.6 million bags from the previous crop year and the highest level in recent years. Due to increasing consumer demand, EU ending inventories are predicted to fall by 400,000 bags to 12.4 million bags.

PV