Vietnam Ships 1.7 Million Tonnes of Coffee as Brazil Delays and EU Rules Reshape Trade

Volume Climbs, Revenue Drops

Vietnam shipped nearly 1.7 million tonnes of coffee valued at just over $6 billion between January and August 2026, according to the Vietnam Coffee Cocoa Association. Volume rose 10 per cent year-on-year, yet export revenue declined 11.2 per cent as global prices softened.

The EU and the United States remain the largest buyers of Vietnamese coffee. At the same time, demand from Asian markets is accelerating, with China emerging as a significant new destination for the commodity.

Nguyen Nam Hai, chairman of the association, noted that conditions in the final months of 2026 favour both volume and price growth for Vietnamese exporters.

Brazil's Harvest Delays and Asian Weather Risks

Several supply-side factors are expected to support coffee prices through year-end. Heavy rainfall and climate disruptions have delayed harvest operations in Brazil, the world's largest producer. Meanwhile, meteorologists anticipate that the El Niño phenomenon, combined with heatwaves and prolonged drought, will affect coffee-growing regions across Asia in late 2026 and into 2027.

Inventory levels in major consuming markets remain low, adding further upward pressure on prices. These dynamics create a window for Vietnamese exporters to capture higher margins, provided they can meet evolving sustainability standards.

EUDR Compliance as a Market Advantage

The European Union Deforestation Regulation takes effect on 30 December 2026, applying immediately to all but small and micro enterprises. The regulation requires exporters to demonstrate that coffee shipments are not linked to deforestation after a specified cut-off date.

According to the Vietnam Coffee Cocoa Association, compliance rates among competing producing countries remain relatively low, presenting an opportunity for Vietnamese suppliers who can meet the new requirements. Many European buyers are already prioritising purchases of EUDR-compliant coffee for contracts scheduled to be signed from October onward.

Shipments that meet the regulation's traceability and sustainability criteria are expected to command a premium of approximately $50 per tonne compared with conventional coffee. The association estimates that EUDR-compliant exports could lift overall volume growth by eight to 10 per cent in the coming months.

Deep Processing and the $9 Billion Target

Global demand for deeply processed coffee products, including roasted beans, instant coffee and specialty blends, is expanding rapidly. The Vietnam Coffee Cocoa Association views these higher-value segments as critical to reaching the industry's $9 billion export target for 2026.

Export growth in the final quarter will hinge on the ability of Vietnamese processors to scale up capacity and improve product quality, alongside meeting the EU's sustainability benchmarks. Buyers in key markets are increasingly specifying processing standards and traceability documentation as part of their procurement criteria.

Supply Surplus Looms in 2027

While near-term fundamentals appear supportive, medium-term forecasts suggest downward price pressure. The US Department of Agriculture projects that global coffee production will increase in the 2026-2027 crop year compared with the previous season, driven by recoveries in major producing countries.

Global supply is estimated at around 189 million bags, while consumption in the United States and Europe is forecast at approximately 179 million bags. The resulting surplus of 10 million bags could weigh on prices if demand in emerging markets does not absorb the excess.

Vietnamese exporters face a narrow window to lock in favourable contracts before the supply-demand balance shifts. The ability to differentiate on sustainability credentials and processing capabilities will determine which producers capture margin gains and which compete solely on price.