Coffee Prices Surge, Vietnam VAT Impact, and Innovation in Coffee Sector

Global Coffee Prices Surge on US Tariffs and Weather Concerns

Global coffee prices reached approximately $391.39 per pound on August 25, 2025, marking a 56.17% increase year-over-year and nearly 30% growth in the past month. This surge is driven by a 50% tariff imposed by the US on Brazilian coffee imports, along with adverse weather conditions such as droughts and frosts in Brazil’s Minas Gerais region. Arabica stocks have dropped to a 14.5-month low, while robusta inventories remain high, putting downward pressure on robusta prices. The tariff has tightened supply and increased market volatility, pushing futures prices to decade highs and forcing major brands like JM Smucker and Keurig to announce price hikes in response (CoffeeBI, 2025-08-25; Storyboard18, 2025-08-29; Chemanalyst, 2025-08-28).

Vietnam’s Coffee Industry Faces New VAT and Rising Export Opportunities

Vietnam introduced a 5% Value Added Tax on coffee beans effective July 1, 2025, leading to domestic price increases and industry controversy. Exporters have requested exemption, citing competitiveness concerns. Despite this, Vietnam’s coffee export value reached $5.4 billion in the first half of 2025, exceeding government projections. The country benefits from strong global demand, especially in emerging markets such as Spain and Algeria, and is expanding production capacity to meet this demand. Concurrently, Brazil posted record export revenues despite a 2% volume decline, driven by higher average prices (Chemanalyst, 2025-08-28; Asianews.network, 2025-08-29).

Brand Sustainability Advances with Nescafé and Common Goal Coffee

Nescafé has surpassed its 2025 target by sourcing 32% of its coffee from farmers practicing regenerative agriculture, exceeding the initial 20% goal. Their “Nescafé Plan 2030” emphasizes soil health improvement, biodiversity, and greenhouse gas reductions of 20-40% per kilogram of unroasted coffee. Social responsibility initiatives include safeguarding human rights and child protection across supply chains (ESG Dive, 2025-08-26).

Common Goal Coffee released its 2025 Sustainability Report highlighting environmental commitments such as reusable and recyclable packaging and support for agroforestry and water conservation practices. They collaborate with carbon-negative coffee producers in Brazil employing cutting-edge agricultural methods that capture more carbon than emitted, showcasing innovation in sustainable coffee production and packaging (Common Goal Coffee, 2025-08-26).

Coffee Equipment Innovation and Market Trends

Suppliers note a cooling in electric coffee grinder sales after a July peak, with customer feedback pointing to grind consistency and cleaning challenges. Market focus is shifting toward premium bean promotions to capitalize on rising consumer demand for artisanal coffee products during the upcoming Q4 and summer months. The global coffee production forecast is optimistic, with a record 178.7 million 60-kg bags expected in 2025/26, driven by rebounds in Vietnam and Indonesia and record yields in Ethiopia (CoffeeBI, 2025-08-21; ESG Dive, 2025-08-26).

Domestic Market Price Stability in Vietnam

Vietnam’s domestic coffee prices remain high, fluctuating between 123,200 and 123,800 VND/kg, reflecting strong global demand and supply constraints. Both London and New York coffee futures have shown robust gains, supporting a positive outlook for the coffee sector through year-end (Báo Kinh tế & Đô thị, 2025-08-28).

Disclaimer: This press review reports data and trends from third-party published sources. CoffeeBI is not responsible for the accuracy of the figures or the content of the original articles. For further insights or tailored analysis on the topic, feel free to contact CoffeeBI.