Coffee Prices Soar, Businesses Adapt
On April 21, the price of domestic coffee continued to rise, setting a new record of over 123,000 VND per kilogram. This price breaks the record set just a short time ago.
The high coffee prices have forced roasters and deep-processing businesses to make plans to adapt to the new situation. However, according to a survey, some coffee businesses in Dak Lak (Vietnam’s coffee capital) are still “waiting” for the right time.
Coffee sets a new price record.
Hoang Danh Huu, founder of the Miss Ede brand, said that even though the price of green coffee beans has increased, the company cannot increase the prices of its deep-processed products from the “black pearl.” This is because the prices of finished products distributed throughout the country have already been fixed by the company. Changing prices during an economic downturn, when consumer purchasing power is low, would be risky. Consumers and distributors may turn away from the brand.
According to Huu, currently, only businesses that sell raw materials to coffee shops or only sell online or on a small scale can increase prices because they are less affected.
Businesses are waiting for the big players in the coffee industry to make a move before making a decision. If they adjust their prices, then other businesses will follow suit. This will make it easier for distributors and consumers to accept the price increase.
Many deep-processing businesses have not yet increased the prices of their products.
Nguyen Thi Hoai Trinh, Deputy Director of G20 Coffee Company in Dak Lak, which roasts coffee beans, owns a coffee brand with many deep-processed products, and has a store that sells coffee directly to consumers, said that the company has not increased prices because it has secured a stable supply of high-quality raw materials from linked farms.
However, when the current supply runs out and the company has to buy new beans, it will adjust prices in line with the market. The company has already notified its partners that a new price list will be implemented after April 30. According to Trinh, the cost of raw materials has increased, so the prices of deep-processed products will have to increase accordingly. However, she revealed that the new prices will be set at a level that customers will accept, while still allowing the company to maintain its profits.
Dao Van Dinh, a coffee enthusiast from Buon Ma Thuot City, Dak Lak, said that some coffee shops have increased their prices. Previously, a hot coffee with milk cost 15,000 VND, but in the past week, the price has been adjusted to 17,000 VND per cup. According to Dinh, the 2,000 VND increase is reasonable because the price of green coffee beans has increased significantly. He hopes that businesses will maintain the quality of their coffee. Consumers are willing to pay a fair price for a quality cup of coffee.
Trinh Duc Minh, Chairman of the Buon Ma Thuot Coffee Association in Dak Lak, said that although the price of green coffee beans has increased, the prices of deep-processed products have not changed much. Some coffee shops have increased their prices, but only slightly, like “dripping water.” Roasters are currently “struggling” because they cannot increase prices due to their contracts with partners. They are currently monitoring the situation, but if the price of green coffee beans remains high, they will have to adjust their prices.
