Vietnam Coffee Market Size
*Disclaimer: Major Players sorted in no particular order
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Vietnam Coffee Market Analysis
Vietnam's coffee market is projected to witness a CAGR of 8.07% over the next five years.
- Vietnam has developed a well-established culture of coffee. The country hosts several companies engaged in not only the domestic trade of coffee but also have established their presence in foreign markets. According to the Agency of Foreign Trade, Vietnam's coffee exports in February 2022 reached 130 thousand tons, worth USD 304 million, whereas compared to February 2021, they increased by 5.7% in volume and 40% in value due to an increase in consumption.
- Vietnam is the world’s second-largest producer and exporter of coffee. The country’s coffee industry is expected to grow strongly over the forecast period as the population continues to expand at a rate of about one million people a year.
- In the coming years, Vietnam's coffee industry is expected to grow strongly due to the ongoing expansion of the population in the country. Data from the World Bank indicates that the population of Vietnam in 2021 was 98,168,829, an increase of 0.85% from the population of Vietnam in 2020. Vietnam's population in 2021 was estimated to be 97,338,583, an increase of 0.90% from its population in 2019. Positive economic growth, the growing employment rate among women, and the increasing disposable income of the young population contribute to the country's coffee market growth. Furthermore, people are becoming more sophisticated in their tastes, driving the country's coffee market. Increased demand for consumer products and the food service industry from local and international players is also expected to fuel the market’s growth.
Vietnam Coffee Industry Segmentation
Coffee is a brewed drink prepared from roasted coffee beans, the seeds of berries from certain flowering plants in the Coffea genus. From the coffee fruit, the seeds are separated to produce a stable, raw product, unroasted green coffee.
Vietnam's coffee market is segmented by product type and distribution channel. The Vietnam coffee market is segmented by product type into whole bean, ground coffee, and instant coffee. Based on distribution channels, the market is segmented into on-trade and off-trade. Off-trade is further sub-segmented into supermarkets/hypermarkets, specialty stores, online retailing, and others.
For each segment, the market sizing and forecasts have been done based on value (in USD million).
Vietnam Coffee Market Trends
This section covers the major market trends shaping the Vietnam Coffee Market according to our research experts:
Instant Coffee is Gaining Traction in the Market due to the Rising Demand
- Busy lifestyles and longer working hours are likely to boost the convenience packaging formats of coffee, resulting in consumers switching from fresh ground coffee to instant coffee mixes across. According to Vietnam Coffee and Cocoa Association (VICOFA), in 2021, the trend of domestic coffee, such as roasted coffee beans, ground, and instant coffee, has increased sharply. Additionally, the roasted, ground and instant coffee export of Vietnam increased and accounted for 12% of the country's total export.
- Premiumization trends are expected to boost the market's growth in the country. With the increase in busy lifestyles among the millennial and working population in the country, coffee consumption among these age groups has increased drastically in the recent past.
- Moreover, due to Vietnam's abundant source of Robusta coffee, which is the primary raw material for the production of instant coffee, this country has the potential to become the world's leading producer of instant coffee. Due to this strong advantage, leading coffee producers in Vietnam are expanding their reach in the market with the introduction of new roasting and instant coffee manufacturing facility. For instance, in August 2021, a joint venture agreement was announced between agricultural commodities company Louis Dreyfus Company (LDC) and private-label coffee maker Instanta to build an instant coffee plant in Vietnam. The venture operates as ILD Coffee Vietnam, and construction commenced at the beginning of 2022. As a result of the factors mentioned above, the demand for coffee is increasing in the country.
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Changing Lifestyle Highly Influencing Coffee Consumption
- Increasingly busy lifestyles and longer working hours are likely to strengthen appreciation for the convenience of this product type, which should lead more consumers to switch from fresh ground coffee or standard instant coffee to instant coffee mixes. Moreover, the category should also benefit as manufacturers continue to introduce stronger-tasting products that suit the traditional preferences of Vietnamese consumers.
- Additionally, there is a rapid shift in the consumer style of the people. The domestic coffee market is becoming more vibrant and competitive every day, especially with the investment of big companies.
- For instance, in October 2021, a new investment of USD 132 million was announced by Nestlé Vietnam to double the capacity of high-quality coffee lines at the Nestlé Tri An coffee factory in Dong Nai province. As a result of this investment, Nestlé Vietnam Co., Ltd. has made almost USD 730 million in foreign direct investment.
- Additionally, the increasing number of cafes and coffee culture in Vietnam is expected to boost the market during the forecast period. The growing interest in coffee consumption among the local population due to changing lifestyles greatly benefits the market.
Vietnam Coffee Industry Overview
The Vietnam coffee market witnesses high competition due to the presence of a considerable number of regional and global players. An advanced distribution network gives an upper edge to the manufacturers to expand their range of products suitable for various consumer needs. Moreover, it is crucial for players to continuously innovate to operate and grow in the market due to the rapidly changing consumer demands and preferences. The Vietnam Coffee market includes the company profiles of Nestle, Bien Hoa Vinacafé Joint Stock Company, Len's Coffee LLC, Starbucks Coffee Company, Phuc Long Trading Production Company Limited, Anni Coffee.
Vietnam Coffee Market Leaders
Bien Hoa Vinacafé Joint Stock Company
Starbucks Coffee Company
Len's Coffee LLC
Phuc Long Trading Production Company Limited
*Disclaimer: Major Players sorted in no particular order
Vietnam Coffee Market News
- August 2022: In Vietnam, Nestlé and Starbucks launched a new coffee experience called 'Starbucks At Home' with four Starbucks' signature flavors of instant coffee - dark roast, caramel latte, caffè mocha, and caffè latte. The We Proudly Serve Starbucks Coffee Program offers premium coffee solutions to selected channels.
- August 2022: Masan Group acquired an 84% stake in Phuc Long Coffee & Tea with a deal valued at USD 453 million. Six months after acquiring the majority stake in a deal worth USD 110 million, the Vietnamese retail conglomerate has taken an additional 34% stake in the company, worth USD 154 million.
- August 2021: Netherlands-based LDC signed a joint venture agreement with Polish private-label coffee company Instanta to build and operate a freeze-dried instant coffee plant in Binh Duong province, Vietnam.
Vietnam Coffee Market Report - Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Drivers
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION
5.1 Product Type
5.1.1 Whole Bean
5.1.2 Ground Coffee
5.1.3 Instant Coffee
5.2 Distribution Channel
220.127.116.11 Speciality Stores
18.104.22.168 Online Retail
22.214.171.124 Other Distribution Channels
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Most Adopted Strategies
6.2 Market Share Analysis
6.3 Company Profiles
6.3.2 Bien Hoa Vinacafe Joint Stock Company
6.3.3 Len's Coffee LLC
6.3.4 Starbucks Coffee Company
6.3.5 Phuc Long Trading Production Company Limited
6.3.6 Anni Coffee
6.3.7 Highlands Coffee
6.3.8 Coffee Beans and Tea Leaves
6.3.9 GLORIA JEANS
6.3.10 TRUNG NGUYEN
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
Vietnam Coffee Market Research FAQs
What is the study period of this market?
The Vietnam Coffee Market market is studied from 2017 - 2027.
What is the growth rate of Vietnam Coffee Market?
The Vietnam Coffee Market is growing at a CAGR of 8.07% over the next 5 years.
Who are the key players in Vietnam Coffee Market?
Nestle, Bien Hoa Vinacafé Joint Stock Company, Starbucks Coffee Company, Len's Coffee LLC, Phuc Long Trading Production Company Limited are the major companies operating in Vietnam Coffee Market.
Vietnam Coffee Industry Report
Statistics for the 2023 Vietnam Coffee market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Vietnam Coffee analysis includes a market forecast outlook to 2028 and historical overview. Get a sample of this industry analysis as a free report PDF download.