May 6, 2016
The Southeast Asian nation is buzzing with all sorts of international investment and commerce as ongoing political reforms opened it up after decades of economic isolation. Specialty coffee is one of the latest industries that is turning towards international markets.
“Only countries with high levels of production per square hectare are able to compete and make money when prices dip down to low levels,” Andrew Hetzel, a value chain specialist with the Coffee Quality Institute, told Devex. Around the equatorial belt of coffee producing-countries, there are essentially just two — Brazil and Vietnam — that are able to consistently compete on commodity-grade quality, he noted.
Specialty coffee is the fastest growing and highest value coffee on global markets and it is likely the most viable route going forward for small scale farmers.
“That’s where we’re seeing the real opportunities in coffee agriculture for smallholder farmers,” Hetzel said. “They have the ability to apply unique characteristics to these coffees that consumers are willing to pay a higher premium for that more directly relates to their cost of production. It’s a lot easier for them to make money than the traditional route through the commodity market and competing head-to-head with machine harvests from Brazil.”