Comprehensive Coffee and Cashew Market Analysis – August 2025

Executive Summary

 

Key Highlights for August 2025:

• Vietnam’s coffee exports achieved record-breaking USD 6.42 billion in the first 8 months, surpassing 2030 targets 5 years ahead of schedule
• Global coffee prices surged dramatically: Robusta futures up 47%, Arabica up 35%
• Vietnam’s cashew exports face pressure from 20% US tariffs imposed in August 2025
• Global cashew market projected to reach USD 14 billion by 2030, growing at 7.1% CAGR

1. Coffee Market Analysis

 

1.1 Vietnam Coffee Market Performance
 

Production and Export Statistics: Vietnam has demonstrated exceptional performance in the global coffee market during the first eight months of 2025. The country exported 1.2 million tons of coffee, generating USD 6.42 billion in revenue. This achievement represents a new industry record and surpasses the government’s 2030 target of USD 6 billion by five years.
 

Detailed August 2025 Performance Metrics:

• August export volume: 95,000 tons valued at USD 429.1 million
• Year-to-date growth (8 months): +8.7% in volume, +59.1% in value compared to 2024
• Average export price: USD 5,580.1 per ton, representing a 46.4% increase year-over-year
• Revenue per ton increased from USD 3,810 in 2024 to USD 5,580.1 in 2025

Geographic Market Distribution
 

Vietnam’s coffee exports demonstrate strong geographic diversification:

• Germany: 14.5% market share (largest consumer)
• Italy: 7.5% market share
• Spain: 7.4% market share
• Other European markets: Combined 25.6%
• Asian markets (China, South Korea, Thailand): 1.85 million bags in MY 2024/25’s first half

Production Capacity and Forecasts
 

The Vietnamese coffee sector shows robust growth potential

• 2025/26 forecast production: 31 million bags (60kg equivalent), up from 29 million bags previous year
• Robusta dominance: 30 million bags (96.8% of total production)
• Arabica production: 1 million bags (3.2% of total production)
• Cultivation area: 730,000 hectares in 2024, with 92% actively harvested
• Central Highlands contribution: 90% of national output from Dak Lak, Lam Dong, Dak Nong, Gia Lai, and Kon Tum provinces

Quality and Technology Improvements
 

Vietnamese coffee producers have invested significantly in modernization:

• Average yield improvements due to better crop management and inputs
• Implementation of advanced processing technologies
• Compliance preparation for EU Deforestation Regulation (EUDR) effective 2026
• Development of traceability systems covering 136,000 hectares of coffee farmland

1.2 Global Coffee Market Dynamics
 

Price Movements and Market Indicators: Global coffee markets experienced significant volatility in August 2025
 

Robusta Coffee Futures (ICE/EU):

• September 2025 contract closed at USD 4,886/ton on August 26
• Monthly increase: USD 1,556/ton (+47%)
• Representing highest levels in recent trading history

Arabica Coffee Futures (ICE/US):

• September 2025 contract reached 384.05 US cents/lb on July 26
• Monthly increase: 100 US cents/lb (+35%)
ICO Composite Indicator Price (I-CIP):
• August 2025 average: 297.05 US cents/lb
• Monthly increase: +14.6% from July 2025
• Annual increase: +24.3% compared to August 2024
• 12-month rolling average: 301.13 US cents/lb
• Price range: 249.12 to 344.64 US cents/lb during August

Brazil – World’s Largest Producer Analysis: Brazil continues to dominate global coffee production despite facing challenges
 

Production Forecasts:

• MY 2024/25: 66.4 million bags (0.2% increase from previous season)
• MY 2025/26: 65 million bags (0.5% increase)
o Arabica: 40.9 million bags (6.4% decline due to biennial cycle)
o Robusta: 24.1 million bags (15% increase)

Export Performance:

• 2024 record exports: 50.5 million bags
• Q1 2025: 11.7 million bags (-1% volume, +68.9% revenue)
• Forecast MY 2025/26: 41.75 million bags (-5.6% decline)

Market Challenges:

• US tariff impact: 50% tariff on Brazilian coffee effective August 6, 2025
• Weather-related stress in Minas Gerais and São Paulo affecting arabica
• Competition from resurgent producers like Vietnam and Indonesia

Global Trade Patterns
 

World Coffee Exports:

• July 2025: 11.42 million bags vs. 11.6 million bags in July 2024
• First 10 months of coffee year 2024/25: 115.61 million bags (-0.3% vs. 115.94 million bags same period 2023/24)

Top Export Destinations from Brazil:

• United States: 15% (despite 18% drop due to tariffs)
• Germany: 14%
• Italy: 7%
• Belgium: 6%
• Japan: 6%

2. Cashew Nut Market Analysis

 

2.1 Vietnam Cashew Market Performance
 

Record-Breaking Export Performance
 

Vietnam’s cashew industry achieved unprecedented success in 2024, setting new benchmarks

• 2024 total exports: 730,000 tons valued at USD 4.37 billion
• Growth rates: +13.3% in volume, +20.2% in value compared to 2023
• Previous record: USD 3.63 billion in 2021
• Average export price 2024: USD 6,003 per ton (+6.1% vs. 2023)

August 2025 Performance Metrics
 

July 2025 Export Data:

• Export volume: 70,560 tons
• Export value: USD 477.7 million
• Volume change: -4.81% year-over-year
• Value change: +2.62% year-over-year (driven by higher unit prices)

Year-to-Date Performance (7 months 2025):

• Total kernel exports: 425,386 tons
• Total value: USD 2.9 billion
• 2025 annual target: USD 4.5 billion (+2.7% vs. 2024)

Raw Material Import Dynamics: Vietnam’s cashew processing industry heavily relies on imported raw cashew nuts
 

July 2025 Import Statistics:

• Raw cashew nut imports: 327,085 tons (+9.53% year-over-year)
• Average import price: USD 1,445/ton (+23.96% vs. July 2024)
• January-July 2025 cumulative: 1.99 million tons valued at USD 3.05 billion (+48% year-over-year)

Major Raw Material Sources:

• African countries (Nigeria, Ivory Coast) remain primary suppliers
• Import dependency underscores industry’s reliance on external sources
• Price volatility in raw materials affecting processing margins

Market Distribution by Geography
 

Key Export Markets July 2025:

• China: 11,967 tons in July (+18.92% year-over-year for Jan-Jul, 84,384 tons total)
• United States: 11,294 tons in July (Jan-Jul imports fell 36% year-over-year to 60,943 tons)
• Netherlands: 11.8% of total exports
• Traditional market shares: US (21.7%), Netherlands (11.8%), China (7.1%)

Impact of US Trade Policies: On August 1, 2025, President Trump announced a 20% tariff on all Vietnamese goods, effective August 7, 2025
 

Immediate Market Impacts:

• Buyers adopting cautious “wait-and-see” approach
• Shift from long-term contracts to spot transactions
• Demand recovery potentially delayed until Q4/2025 and Q1/2026
• Price pressure on Vietnamese exporters to maintain competitiveness

2.2 Global Cashew Market Dynamics
 

Market Size and Growth Projections: The global cashew market demonstrates strong growth potential across multiple forecasting models

Market Valuation Forecasts:

• 2025 market size: USD 9.9 billion (Mordor Intelligence)
• 2030 projection: USD 14 billion
• CAGR 2025-2030: 7.1%

Alternative Projections:

• Straits Research: USD 8.14 billion (2025) to USD 11.67 billion (2033)
• CAGR: 4.6% (2025-2033)

Regional Production Patterns
 

Asia-Pacific Dominance:

• Market share: 62.5% of 2024 global output
• India production: 782,000 metric tons harvest
• Vietnam processing capacity: 347,634 metric tons processing base
African Production Growth:
• West African governments implementing fertilizer subsidies
• Seedling distribution programs
• Farm-gate price floors to lift smallholder incomes
• Côte d’Ivoire farm-gate prices increased 7% year-over-year in 2025

Trade Policy Impacts
 

US Tariff Structure (April 2025):

• Vietnamese kernels: 46% tariff
• Indian kernels: 26% tariff (maintained)
• Driving US importers to diversify sourcing strategies

Regional Market Sentiment:

• Korea: Weak summer demand, restocking expected September-October ahead of Chuseok holiday
• Turkey: Slow demand due to summer holidays, purchases expected to resume in September
• China: Strong kernel demand during Chinese New Year festivities
• India: Weaker domestic demand with healthy inventories

Logistics and Supply Chain Challenges
 

Red Sea Crisis Impact:

• Houthi attacks on vessels near Israeli ports
• Rising freight rates for shipments to Europe, Middle East, and US
• Longer transit times as vessels bypass Suez Canal
• Increased transportation costs affecting profit margins

Currency and Domestic Factors:

• USD/VND exchange rate: 26,090 (August 2025) vs. 24,870 (August 2024) (+4.9%)
• Benefits exporters through higher VND revenue
• Increases costs for imported raw materials
• New 5% VAT on domestic cashew transactions in Vietnam adds financial strain

3. Price Analysis and Market Trends

 

3.1 Coffee Price Dynamics
 

Fundamental Price Drivers

Supply-Side Factors:

• Weather volatility as most critical short-term factor
• Brazil drought devastating arabica harvest
• Vietnam maintaining stable robusta supply
• Low global inventories amplifying price volatility

Demand-Side Factors:

• Asian market expansion (China, South Korea, Thailand)
• US remaining largest coffee importer (32% from Brazil)
• European market maintaining steady demand
• Growing preference for specialty and processed coffee

Technical Price Analysis:

• Coffee C Futures reaching all-time highs in March 2025
• Brazil arabica prices up 4% in August vs. July
• Conilon (robusta) gaining 13% in August
• Inventory levels critically low, amplifying supply shocks

Vietnam Coffee Pricing Strategy
 

Competitive Advantages:

• Advanced processing technologies maintaining cost efficiency
• Efficient production and logistics creating cost advantages
• Superior quality adherence to international standards
• Competitive pricing despite global price increases

3.2 Cashew Price Trends
 

Global Price Projections
 

Market Analyst Forecasts:

• Kernel prices potentially exceeding USD 4.50 per pound
• Raw cashew prices increasing at origin
• Price trajectory dependent on global demand patterns and processing capacities
Current Price Dynamics:
• Whole kernels at historically low prices
• Broken grades more expensive due to limited supply
• Processing operations cutting or suspending due to margin pressure
• Market improvement dependent on RCN price alignment with kernel values

Regional Price Variations
 

Southeast Asian Markets:

• Vietnam and Cambodia reporting harvest delays
• Prices remaining relatively stable for March shipments
• Order flows from Western markets at reduced volumes

Indian Market Conditions:

• Decreasing export prices and volumes
• Rupee depreciation against dollar affecting competitiveness
• Domestic demand remaining weak with healthy inventories

4. Industry Challenges and Opportunities

 

4.1 Coffee Sector Analysis
 

Opportunities for Growth
 

Market Expansion:

• Asian markets: China’s tree-nut intake rising 5% annually, per-capita use forecast to reach 1kg by 2030
• Specialty coffee growth: Increasing demand for value-added products
• Sustainability premium: Certified organic and sustainable coffee commanding 15-20% premiums
• Processing advancement: Investment in roasted and soluble coffee for higher margins
Technological Advantages:
• Modern processing facilities with automated machinery
• Quality control systems ensuring international standards
• Sustainable farming practices meeting global requirements
• Traceability systems for EUDR compliance
Challenges and Risk Factors
Regulatory Compliance:
• EUDR implementation: 41% of Vietnam’s coffee exports destined for EU
• Compliance costs and administrative burden
• Need for comprehensive traceability systems
• Potential market access restrictions for non-compliant producers

Climate and Environmental Risks:

• Weather volatility affecting yield consistency
• Drought impact on arabica production in key regions
• Need for climate-resilient farming practices
• Water management and irrigation infrastructure requirements

Trade Policy Risks:

• US tariff impacts on Brazilian competitors
• Potential future trade restrictions
• Currency fluctuation affecting competitiveness
• Geopolitical tensions affecting supply chains

4.2 Cashew Sector Analysis
 

Growth Opportunities
 

Consumer Trend Alignment:

• Health consciousness: Rising demand for plant-based, protein-rich snacks
• Vegan movement: Cashews essential for dairy alternatives
• Premium positioning: Organic and specialty cashews commanding higher prices
• Food processing integration: Increased use in bakery, confectionery, and beverage industries

Market Development:

• Emerging markets: Middle East (UAE, Saudi Arabia, Qatar) rapidly growing
• Value addition: OEM services and private-label opportunities
• Product innovation: Flavored, roasted, and processed cashew products
• E-commerce expansion: Direct-to-consumer sales channels

Strategic Challenges
 

Trade Barriers:

• US tariff structure: 46% on Vietnamese vs. 26% on Indian cashews
• Market access restrictions: Potential expansion of trade barriers
• Competition intensification: African processors increasing local value addition
• Supply chain vulnerabilities: Dependence on imported raw materials

Operational Challenges:

• Raw material cost volatility: 23.96% price increase in July 2025
• Processing margin pressure: High RCN costs vs. kernel prices
• Labor cost inflation: Rising operational expenses
• Quality control: Maintaining international standards while scaling

Logistics and Infrastructure:

• Freight cost increases: Red Sea crisis affecting shipping routes
• Transportation delays: Extended transit times affecting supply reliability
• Storage and inventory: Cash flow constraints limiting stockholding
• Currency risk: Exchange rate volatility affecting profitability

5. Strategic Recommendations

 

5.1 Vietnam Coffee Industry Strategy
 

Short-term Actions (6-12 months)
 

Market Optimization:

• Capitalize on current high prices through strategic pricing
• Maintain quality standards to preserve market share
• Diversify customer base to reduce dependency on traditional markets
• Implement flexible contract structures to manage price volatility

Regulatory Preparation:

• Accelerate EUDR compliance initiatives
• Develop comprehensive traceability systems
• Obtain necessary certifications (Rainforest Alliance, etc.)
• Create documentation systems for deforestation-free verification

Medium-term Strategy (1-3 years)
 

Value Addition:

• Invest in specialty coffee processing capabilities
• Develop roasted and soluble coffee production
• Create branded products for retail markets
• Establish direct trade relationships with premium buyers

Market Expansion:

• Penetrate Asian markets (China, South Korea, Thailand)
• Develop institutional sales channels
• Create partnerships with international coffee chains
• Establish regional distribution centers
Long-term Vision (3-5 years)

Sustainability Leadership:

• Implement climate-smart agriculture practices
• Develop carbon-neutral production processes
• Create farmer support programs for sustainable practices
• Establish Vietnam as premium sustainable coffee source

Technology Integration:

• Deploy IoT and precision agriculture technologies
• Implement blockchain for supply chain transparency
• Develop AI-driven quality control systems
• Create digital platforms for farmer support

5.2 Vietnam Cashew Industry Strategy
 

Immediate Response (3-6 months)
 

Trade Policy Adaptation:

• Diversify export markets to reduce US dependency
• Accelerate market development in Europe and Asia
• Develop flexible pricing strategies for different markets
• Create strategic inventory management systems

Cost Optimization:

• Implement efficiency improvements in processing
• Negotiate long-term raw material supply contracts
• Optimize logistics and transportation costs
• Develop currency hedging strategies
Strategic Development (6-24 months)

Market Diversification:

• European expansion: Leverage 71.56% EU market share
• Asian market development: Focus on China, Japan, South Korea
• Middle East penetration: Target UAE, Saudi Arabia, Qatar
• Emerging markets: Explore opportunities in Africa and Latin America

Product Innovation:

• Develop value-added products (flavored, organic, roasted)
• Create cashew-based food ingredients
• Establish private-label manufacturing capabilities
• Invest in packaging and branding for retail markets

Long-term Transformation (2-5 years)
 

Vertical Integration:

• Develop domestic cashew cultivation to reduce import dependency
• Create integrated supply chain from farm to consumer
• Establish regional processing centers in Africa
• Build strategic partnerships with raw material suppliers

Brand Development:

• Create premium Vietnamese cashew brands
• Develop direct-to-consumer sales channels
• Establish international marketing presence
• Obtain premium certifications (organic, fair trade, etc.)

6. Risk Assessment and Mitigation

 

6.1 Market Risks
 

Coffee Sector Risks
 

Price Volatility Risk:

• Impact: Sudden price drops could affect farmer income and export revenues
• Mitigation: Develop price hedging mechanisms, diversify product portfolio
• Monitoring: Track global supply/demand indicators, weather patterns

Regulatory Compliance Risk:

• Impact: Non-compliance with EUDR could restrict EU market access
• Mitigation: Invest in traceability systems, obtain certifications early
• Timeline: Implementation required by 2026
Climate Risk:
• Impact: Weather volatility affecting production consistency
• Mitigation: Climate-smart agriculture, irrigation infrastructure
• Adaptation: Develop resilient cultivation practices

Cashew Sector Risks
 

Trade Policy Risk:

• Impact: Further tariff increases could reduce market access
• Mitigation: Market diversification, government-to-government negotiations
• Contingency: Develop alternative market strategies

Raw Material Supply Risk:

• Impact: Disrupted African supply could affect processing operations
• Mitigation: Diversify supplier base, develop domestic cultivation
• Strategy: Create strategic reserve inventory systems

6.2 Operational Risks
 

Supply Chain Disruptions
 

Logistics Risk:

• Red Sea crisis: Continued shipping disruptions
• Mitigation: Diversify shipping routes, build inventory buffers
• Cost management: Negotiate flexible shipping contracts

Currency Risk:

• USD/VND volatility: Affecting export competitiveness
• Mitigation: Implement currency hedging strategies
• Pricing: Develop dynamic pricing mechanisms

Quality and Compliance Risks
 

Food Safety Standards:

• Aflatoxin contamination: Risk in humid storage conditions
• Mitigation: Implement strict quality control systems
• Prevention: Upgrade storage and processing facilities

International Standards:

• Certification requirements: Evolving international standards
• Compliance: Regular audits and certification renewals
• Investment: Continuous facility and process upgrades

7. Future Market Outlook

 

7.1 Coffee Market Projections
 

Global Market Trends (2025-2030)
 

Demand Growth:

• Specialty coffee: Expected to grow 8-10% annually
• Asian consumption: China market projected to double by 2030
• Sustainable coffee: Premium segment growing 15% annually
• Instant coffee: Steady growth in developing markets

Supply Dynamics:

• Climate adaptation: Need for resilient cultivation practices
• Technology adoption: Precision agriculture and processing automation
• Sustainability focus: Deforestation-free and carbon-neutral production
• Value chain optimization: Direct trade and traceability systems

Vietnam’s Competitive Position
 

Strengths to Leverage:

• Robusta market leadership position
• Cost-competitive production
• Advanced processing capabilities
• Strong government support

Areas for Development:

• Arabica cultivation expansion
• Specialty coffee development
• Brand building and marketing
• Sustainability certification

7.2 Cashew Market Projections
 

Global Growth Drivers (2025-2030)
 

Consumer Trends:

• Plant-based diet adoption: 20-25% annual growth in vegan products
• Health consciousness: Premium nut consumption increasing
• Snack market expansion: Healthy snacking trend continuing
• Food processing integration: Industrial use expanding

Market Development:

• Emerging market growth: Middle East, Asia-Pacific expansion
• E-commerce penetration: Online sales channel development
• Product innovation: Value-added product categories
• Sustainability premium: Organic and fair-trade segments

Vietnam’s Strategic Positioning
 

Competitive Advantages:

• World’s largest processor and exporter
• Advanced processing technology
• Quality control systems
• Established global customer base

Strategic Imperatives:

• Market diversification beyond US
• Value addition and branding
• Supply chain resilience
• Sustainability leadership

8. Conclusions and Key Takeaways

 

8.1 Coffee Industry Assessment
 

Vietnam’s coffee industry is experiencing a golden period in August 2025, with record-breaking export revenues and global price advantages. The achievement of USD 6.42 billion in eight months, surpassing 2030 targets five years early, demonstrates the sector’s exceptional performance and global competitiveness.
 

Critical Success Factors:

• Price advantage: 47% increase in Robusta prices benefiting Vietnamese exporters
• Quality consistency: Maintaining international standards while scaling production
• Market diversification: Asian market expansion reducing European dependency
• Technology adoption: Advanced processing and quality control systems

Strategic Imperatives:

• EUDR compliance: Preparing for 2026 implementation affecting 41% of exports
• Sustainability leadership: Developing climate-smart and deforestation-free practices
• Value addition: Investing in specialty and processed coffee segments
• Market expansion: Penetrating high-growth Asian markets

8.2 Cashew Industry Assessment
 

The Vietnamese cashew industry faces a pivotal moment in August 2025, balancing record-setting 2024 performance with new challenges from US trade policies. The 20% tariff implementation represents a significant short-term challenge requiring strategic adaptation.
 

Market Position Strengths:

• Global leadership: World’s largest processor and exporter
• Quality reputation: Premium product recognition in international markets
• Processing capabilities: Advanced technology and quality control systems
• Market reach: Presence in over 90 countries and territories

Strategic Challenges:

• Trade policy impacts: 20% US tariffs affecting largest export market
• Raw material dependency: Reliance on African imports creating supply risk
• Cost pressures: Rising raw material and processing costs
• Competition: Increasing African local processing capabilities

8.3 Overall Market Outlook
 

Both sectors demonstrate resilience and growth potential despite facing distinct challenges. The coffee industry benefits from favorable price dynamics and growing global demand, while the cashew sector must navigate trade policy headwinds while capitalizing on health-conscious consumer trends.
 

Integrated Strategy Recommendations:

1. Diversification: Both sectors should prioritize market diversification to reduce dependency on traditional markets
2. Value Addition: Investment in processing, branding, and premium products essential for margin improvement
3. Sustainability: Environmental and social sustainability becoming critical competitive factors
4. Technology Integration: Digital transformation and automation necessary for efficiency and traceability
5. Government Support: Continued policy support for infrastructure, certification, and market access critical

Long-term Competitive Positioning: Vietnam’s agricultural export industries are well-positioned for sustained growth through 2030, provided strategic investments in sustainability, technology, and market diversification are executed effectively. The current strong performance provides the financial foundation for these strategic investments, while the emerging challenges create urgency for adaptation and innovation.
 

The success of both industries will depend on their ability to balance short-term market pressures with long-term strategic development, maintaining Vietnam’s position as a global leader in tropical agricultural exports while adapting to evolving international trade dynamics and consumer preferences.
 

This comprehensive analysis is based on data from authoritative sources including USDA Foreign Agricultural Service, International Coffee Organization (ICO), Vietnam Cashew Association (VINACAS), Mordor Intelligence, and various international commodity trading organizations.
 

M.Sc. Huynh Lam
Data Analysis Team, KAIFarm®