Vietnam Coffee Exports To The United Kingdom Market – Information from the Ministry of Industry and Trade said that the Vietnam – UK Free Trade Agreement (UKVFTA) came into effect, bringing many prospects for the Vietnamese coffee industry in the UK market.
Coffee is one of the 13 essential agricultural products of Vietnam. The coffee industry contributes 3% of the country’s GDP, creating jobs and stable incomes for over 600,000 farming households.
According to the General Department of Customs, in April 2022, Vietnam exported 2137 tons of coffee to the UK market, with an average monthly export price of 2137 USD/ton, worth 4.56 million USD.
In the first four months of 2022, Vietnam Coffee Exports to the UK reached 50.3 million USD, up 145.84% in volume and 196.67% in value over the same period in 2021.
The Ministry of Industry and Trade portal, citing data from the International Trade Center (ITC), said that in 2021, total coffee imports from the world market to the UK would reach 203.38 thousand tons worth 945.56 million dollars.
The average import price of coffee into the UK reached $4,649/ton, up 7.5% compared to 2020.
Statistics show that the EU is still the largest supplier of coffee to the UK market, while Asia (including Vietnam) only supplies about 90 million tons/year.
However, coffee from Vietnam and some other suppliers has also been purchased by international roasters, including many EU roasters, and packaged and exported to the UK market with their labels.
British consumers traditionally drink more instant coffee than European countries. However, the reality also shows that sales of ground coffee and speciality coffee are increasing.
Especially, coffee certified for quality or the environment, labour… is significant for British consumers.
The British do not drink strong coffee like Vietnamese black coffee in terms of taste. The finished coffee has a strong smell and taste that will be difficult to sell in the UK market.
British people have a habit of reading information on the packaging very carefully to determine if a product contains allergenic ingredients, how it should be prepared, meets ESG (environmental, social and governance) or not.
Distributors will welcome products that are both suitable for consumer tastes and have beautiful packaging.
According to experts, green coffee from Vietnam is mostly low-quality Robusta, and the competition on low prices is no longer appropriate.
To meet the needs and tastes of the British as well as to penetrate deeper into this market, businesses need to invest in producing high-quality Arabica from smaller-scale growing areas with better governance, more traceability and sustainable development.
At the same time, actively build and develop customer relationships with large distribution corporations.
In particular, take the initiative in preserving and transporting agricultural products by sea; make good use of preferential credit policies and credit assessment and verification services of British banks’ customers.
The Ministry of Industry and Trade said Vietnamese businesses need to take advantage of the opportunities brought by UKVFTA quickly.
Because according to UKVFTA’s commitment, after six years since UKVFTA takes effect, the UK will eliminate import tax on 99.2% of tariff lines, equivalent to 99.7% of Vietnam’s export turnover.
To support exporters in general and coffee enterprises, in particular, to expand their market share in this market, in the coming time, the Ministry of Industry and Trade will promote support for Vietnamese businesses to connect with other companies’ imports from Great Britain and Ireland.