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A new step when Vietnam becomes the largest coffee supplier in Japan

In September, according to the Nikkei Asia Review, the amount of instant coffee consumed in Japan increased sharply. The reason is due to the number of people staying at home because of the impact of the COVID-19 pandemic.

  1. Vietnam – Japan’s largest coffee supplier

In recent times, Vietnam has made a strong transformation when reaching out to become the largest coffee supplier in Japan. This is also the leading factor leading to the high rate of Robusta coffee (the main raw material for processing instant coffee).

In contrast, sales of Arabica coffee showed signs of decline, even though this is a premium coffee line used by coffee shops.

In 2020, Vietnam has become the largest coffee supplier in Japan
In 2020, Vietnam has become the largest coffee supplier in Japan

It is this trend that has made our country – the world’s largest producer of Robusta coffee – take a new step forward when becoming the largest coffee supplier in the country of the Rising Sun. This means that Brazilian coffee has to fall to the 2nd position in the list of countries supplying coffee to Japan.

  1. Coffee prices in different countries

In London – United Kingdom: The current price of Robusta coffee has increased to the highest level during the past 18 months. Meanwhile, at the same time, the price of Arabica coffee showed a slight decrease. Specifically:

Robusta coffee prices in September 2020 fluctuated around $1,480/ton – $1,554/ton (up 9%).

In New York, the price of Arabica coffee in the futures market fluctuated from 1.2 USD/pound (Down 5% over the same period). That means at the beginning of the season both Robusta and Arabica coffee increased. However, up to the present time, the price of these two types of coffee has diverged.

When the Japanese Government declared a state of emergency due to the respiratory infection pandemic around April 2020. Most restaurants and cafes are closed. At the same time, the Starbucks Coffee Japan brand has temporarily closed more than 1,100 coffee shops across Japan. This is a strong blow to the demand for Arabica coffee.

According to the head of sales at S. Ishimitsu & Co – Expert Masaomi Arikawa said: When the epidemic emergency has been canceled, the number of diners at restaurants and cafes has been canceled. still can’t get it back to how it was before. Therefore, demand for Arabica coffee is still weak.

Vietnam mainly exports Robusta unroasted coffee beans to Japan
Vietnam mainly exports Robusta unroasted coffee beans to Japan

In contrast, the demand for Robusta coffee – The cheaper and more bitter coffee used in instant coffee tends to increase strongly.

According to the food processing company Ajinomoto AGF, the current demand for instant coffee is increasing strongly with the rate of 10% over the same period.

It is the changes in demand and consumption style that have affected the import of unroasted coffee beans from Japan. According to the statistical report, in the period January – July 2020, Vietnam is the largest supplier of unroasted coffee beans to Japan.

As of September 2020, Japan has imported a total of 67,392 tons of unroasted coffee beans from Southeast Asian countries, a 26% increase compared to the same period last year.

Meanwhile, in Brazil, the main source of Arabica coffee is supplied to Japan, the number decreased to only 63,850 tons.

Compared to this number, it is enough to realize that this is the first time our country has surpassed Brazil in becoming the largest coffee supplier to Japan.

Advisor of specialty coffee trading company Wataru & Co – Mr. Shiro Ozawa, currently based in Tokyo, commented: Vietnam is on the rise, promising to continue to lead Brazil in the future. 2020 in terms of coffee exports to Japan. This is a “historic moment”, he said.

  1. About Robusta coffee market

It is known that the Robusta coffee variety is highly resistant to pests and diseases compared to the premium Arabica coffee variety. In particular, Robusta coffee can also be grown at lower altitudes, so it is preferable to be planted in many different locations.

It is these factors that have boosted the market share of Robusta coffee in global production in recent years. According to Mr. Ozawa, over the past 40 years, the market share of Robusta coffee has increased from 20% to 40%, Arabica coffee has decreased from 80% to 60% now.

The Robusta coffee market will decrease in price in the coming months due to the massive increase in product volume
The Robusta coffee market will decrease in price in the coming months due to the massive increase in product volume

However, the price of Robusta coffee will likely fall for many more months. because the market demand has made the product increase massively, leading to an overabundance in the coffee bean market.

Also according to what the US Department of Agriculture has just reported, world coffee production in the 2020-2021 crop will likely increase by more than 5% compared to the previous year, specifically increasing to about 176.085 million bags. However, the volume of coffee consumption is expected to reach only 166,284 million bags (up 1.4%) in the same period last year. If this prediction is correct, this will be the next year in a row for 3 years coffee production is higher than consumption.

Particularly, the director of the beverage division of Marubeni Group – Mr. Kazuyuki Kajiwara said: The coffee market in the future will fall into a situation where supply is higher than demand in the next two years. If the price of coffee remains low, some coffee growing places will stop producing, especially those that favor Arabica coffee.

Hopefully with the information we share, you will have the clearest view of the coffee export market in Vietnam to Japan and certain success has been achieved. Thank you for your attention.

Refer to the article Top 3 most popular coffee sprinklers 2020-2021

Emilia Chaney
Emilia Chaneyhttps://agrisearch.net
My name is Emilia Chaney. I'm a social girl from Romania with a big smile and 3 passions: Agriculture, Travel and Social Media. I try to make this blog practical, full of great advice and inspiring ideas.

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