Vietnamese coffee is poised for export growth thanks to its compliance advantage with the EU's Deforestation Regulation (EUDR), but the challenge of meeting standards across growing areas remains significant.

First-half exports decline in value

According to the Import-Export Department, Vietnam exported 1.05 million tonnes of coffee worth $4.81 billion in the first six months of the year, up 7.4% in volume but down 13.8% in value compared to the same period last year. The main reason is a sharp drop in coffee prices after global supply recovered.

The 2026-27 global crop is expected to reach around 189 million bags, while consumption is projected at 179 million bags, creating a surplus of about 10 million bags and putting downward pressure on prices.

$9 billion target and shift to deep processing

The Vietnam Coffee-Cocoa Association (VICOFA) expects Vietnam's coffee output to rise 8-10% this year. The industry targets exports of about $9 billion, compared to the record $8.92 billion in 2025.

Currently, 91.7% of coffee exports are green beans, while instant coffee and other value-added products account for only 8.3% of volume but contribute 17% of export value. This shows the large potential of deep processing.

Many companies have accelerated investment in new processing plants and expanded production lines to meet demand, especially from China – a rapidly growing market for instant and roasted coffee.

EUDR: competitive advantage but limited compliant area

Vietnam is classified as a low-risk country under EUDR, allowing EU importers to apply simplified due diligence procedures. This is a significant competitive advantage.

Europe is currently the largest market for Vietnamese coffee, accounting for about 55% of export volumes, with the 27 EU member states accounting for over 45%.

According to Mr. Nguyen Nam Hai, Chairman of VICOFA, foreign buyers are actively purchasing EUDR-compliant Vietnamese coffee at a premium of about $50 per tonne over conventional coffee.

However, only 35-40% of Vietnam's coffee-growing areas fully meet EUDR traceability requirements. This means the majority of areas are not yet ready to benefit from the higher price.

Implications for exporters

For coffee exporters, ensuring EUDR-compliant traceability not only facilitates access to the EU market but also allows selling at higher prices. However, if compliant area remains limited, companies need to quickly expand raw material zones that meet requirements.

The article does not specify when the low-risk classification officially takes effect, nor the specific requirements of EUDR. Businesses should monitor information from the Ministry of Agriculture and Environment for updates.

Increasing the share of deep-processed coffee will improve export value, but also requires significant investment. Companies need to consider long-term strategies to leverage both trends: EUDR and deep processing.