Severe Drought in Central Vietnam is causing coffee prices to rise

Central Vietnam is currently facing a severe drought that is having a significant impact on the region's coffee industry. As a result of the prolonged dry spell, coffee production has been severely affected, leading to a decrease in supply. This drop in supply has caused coffee prices to increase, affecting both local farmers and consumers.

How severe is the drought in Central Vietnam?

The drought in Central Vietnam has been described as one of the worst in decades. The lack of rainfall has dried up reservoirs and rivers, making it difficult for farmers to irrigate their crops. This has resulted in wilting coffee plants and a significant decrease in coffee yields.

What is the impact on coffee production?

The decrease in coffee production due to the drought has led to a shortage of coffee beans in the market. This shortage has caused coffee prices to rise as demand outstrips supply. As a result, both local farmers and coffee exporters are facing financial challenges due to the decrease in production and the increase in prices.

How are consumers affected?

Consumers are also feeling the impact of the drought in Central Vietnam. The increase in coffee prices has led to higher costs for coffee products both domestically and internationally. This price increase is likely to continue until the region receives significant rainfall to improve coffee production.

In conclusion, the severe drought in Central Vietnam is causing a ripple effect in the coffee industry, leading to a decrease in production and an increase in prices. It is essential for stakeholders in the coffee supply chain to come together to find solutions to mitigate the impact of the drought and ensure the sustainability of the coffee industry in the region.

Just to give some context, raw robusta beans compared to the start of 2024 until July 2024, has saw a price increase of $3/kg or a 45% price increase.

Citation:

Vietnamese robusta bean production declining, hiking up price of instant coffee - ABC News