Coffee in Vietnam

Coffee in Vietnam
Euromonitor International
January 2022
COFFEE IN VIETNAM Passport i
LIST OF CONTENTS AND TABLES

KEY DATA FINDINGS.................................................................................................................. 1
2021 DEVELOPMENTS ............................................................................................................... 1
Coffee maintains A positive retail performance in 2021, thanks to A switch from on-trade to
off-trade consumption ............................................................................................................... 1
Negative impacts to foodservice continue in 2021, due to ongoing COVID-19 measures ........ 1
Nestlé maintains its top place thanks to ongoing innovation in new flavours to target an
affluent consumer audience ...................................................................................................... 2
PROSPECTS AND OPPORTUNITIES......................................................................................... 2
Coffee is set to show stronger performance over the forecast period, as pandemic restrictions
loosen and consumer confidence returns ................................................................................. 2
Foodservice operators will concentrate on developing their coffee brands, with retail launches
expected ................................................................................................................................... 3
Key retail players also projected to focus on innovations to meet emerging consumer
demands ................................................................................................................................... 3
CATEGORY DATA ....................................................................................................................... 3
Table 1 Retail Sales of Coffee by Category: Volume 2016-2021 .............................. 3
Table 2 Retail Sales of Coffee by Category: Value 2016-2021 ................................. 4
Table 3 Retail Sales of Coffee by Category: % Volume Growth 2016-2021 ............. 4
Table 4 Retail Sales of Coffee by Category: % Value Growth 2016-2021 ................ 4
Table 5 Retail Sales of Fresh Coffee by Regular vs Decaffeinated: % Volume
2016-2021 .................................................................................................... 5
Table 6 NBO Company Shares of Coffee: % Retail Value 2017-2021 ...................... 5
Table 7 LBN Brand Shares of Coffee: % Retail Value 2018-2021 ............................ 5
Table 8 Forecast Retail Sales of Coffee by Category: Volume 2021-2026 ............... 6
Table 9 Forecast Retail Sales of Coffee by Category: Value 2021-2026 .................. 7
Table 10 Forecast Retail Sales of Coffee by Category: % Volume Growth 2021-
2026 ............................................................................................................. 7
Table 11 Forecast Retail Sales of Coffee by Category: % Value Growth 2021-
2026 ............................................................................................................. 7
Table 12 Forecast Retail Sales of Fresh Coffee by Regular vs Decaffeinated: %
Volume 2021-2026 ....................................................................................... 8
© Euromonitor International
COFFEE IN VIETNAM Passport 1
COFFEE IN VIETNAM
KEY DATA FINDINGS
▪ Coffee maintains a positive retail performance in 2021, thanks to a switch from on-trade to off-
trade consumption
▪ Coffee shows 6% retail value growth and 2% retail volume growth in 2021, to reach VND10.2
trillion and 54,233 tonnes
▪ Foodservice volume shows 7% volume decline in 2021, to reach 45,681 tonnes
▪ Nestlé Vietnam Co Ltd maintains its decent lead in coffee in 2021, with 36% company value
shares
▪ Coffee is expected to record 8% retail value CAGR and 3% retail volume CAGR to reach
VND14.7 trillion and 62,778 tonnes in 2026
2021 DEVELOPMENTS
Coffee maintains A positive retail performance in 2021, thanks to A

switch from on-trade to off-trade consumption
Coffee has maintained a positive performance in retail value and volume over the time of the
pandemic in 2020 and 2021, in contrast to foodservice sales which slumped into negative-figure
declines. During the pandemic lockdowns, all on-trade channels were required to close and thus
consumers switched their coffee consumption from foodservice to off-trade. The negative impact
on foodservice is at lower levels in 2021 than seen in 2020, albeit further on-trade closures
during another peak of infections from May 2021, alongside supressed tourism, continue to
place downwards pressure on the foodservice channel.
At the peak of the COVID-19 pandemic in 2020, the Vietnamese government implemented
strict social distancing protocols in an effort to control the spread of the virus. This involved the
closure of all educational institutions such as schools and universities, as well as the mandated
closure of all restaurants, bars and pubs. Furthermore, a ban was imposed on all gatherings of
more than 30 people. While foodservice sales fell substantially over the course of the year due
to the unavailability of cafés and other on-trade venues, retail value growth remained positive as
demand shifted to off-trade. Faced with a potentially extensive quarantine lockdown during the
early stages of the pandemic, many consumers tended to stock up on coffee so as to eliminate
any chance of running out of coffee and to reduce the need to go out on a regular basis to
restock their coffee supplies. In addition, coffee is, of course, a product which lends itself to
stockpiling due to its long shelf life in packaged format.
Negative impacts to foodservice continue in 2021, due to ongoing

COVID-19 measures
As mentioned above, the main reason for the substantial declines seen in foodservice sales of
coffee in Vietnam during 2020 was the quarantine lockdown which was in place in the country
between the middle of March and the end of April 2020. This extensive and strictly enforced
social distancing measure was undertaken primarily to curb the spread of the COVID-19 virus
and typified the particularly robust approach to the principles of social distancing which were
taken in the country. As a result of all cafés, specialist of shops and restaurants being
unavailable for an extended period, sales of coffee dropped to minimal levels. Furthermore,
once the quarantine lockdown was lifted, many people continued to avoid consumer foodservice
outlets due to the elevated risk of contracting the COVID-19 virus that spending time in such
establishments would represent.
Another major factor placing pressure on demand for coffee in the on-trade during 2020 was
the dramatic decline seen in inbound tourism flows over the course of the year. This was due to
Vietnam’s borders being closed to foreign visitors for an extended period during the year, as
well as the understandable reluctance of many people to engage with international air travel due
to the elevated risk of contracting or spreading the COVID-19 virus. This absence of foreign
tourism dealt a further blow to the country’s specialist coffee shops, with both Starbucks and
Coffee Bean registering steep declines in the numbers of customers in their outlets between
April and September 2020, in comparison with the same months of 2019. Within this context, it
is understandable that on-trade volume sales of coffee recorded such strong declines during
2020, which are continuing to a lesser extent in 2021 due to ongoing COVID-19 measures.
Nestlé maintains its top place thanks to ongoing innovation in new

flavours to target an affluent consumer audience
Nestlé Vietnam Co Ltd maintains its decent lead in coffee in 2021, thanks to the success of its
iconic Nescafé brand. The player is also active in product innovations, for example by
introducing Nescafé Latte Hazelnut in May 2020. The product is made from 100% Vietnamese
Robusta coffee beans and offers an instant, at-home, flavoured latte coffee which is similar to
that found in specialist coffee shops. Latte is noted as being particularly popular with consumers
in Vietnam, especially so with female consumers during the lockdowns.
Nestlé has also engaged in flavour innovations previously, with the launch of Nescafé Café
Viet Tequila and Nescafé Cappuccino Coconut. The target audience for these two products
comprises mainly young professionals and, while Nescafé Café Viet Tequila targets
sophisticated male professionals, Nescafé Cappuccino Coconut targets their female
counterparts. This target audience of young professionals has been less negatively impacted by
the COVID-19 pandemic, specifically in terms of their incomes coming under less pressure and
thus they are still able to spend money on sophisticated new products. This has made them a
particularly attractive target audience for new product development in coffee, as the negative
economic impact of the COVID-19 pandemic has led to many Vietnamese households facing
financial challenges.
PROSPECTS AND OPPORTUNITIES
Coffee is set to show stronger performance over the forecast period, as

pandemic restrictions loosen and consumer confidence returns
Sales in coffee are expected to ramp up again over the forecast period, with foodservice also
rebounding from 2022. This is attributed to a loosening of pandemic restrictions as the
Vietnamese government aims to reach high COVID-19 vaccination rates by mid-2022. As such,
on-trade sales will increase in turn and assist the overall performance of coffee over the forecast
period.
One major factor to take into consideration here is the highly effective management of the
COVID-19 situation by the Vietnamese government, which is expected to result in there being a
minimal impact being felt from the COVID-19 situation during 2020 and 2021. Indeed, the
response of the Vietnamese government from the onset of the COVID-19 pandemic has been
widely praised and this is a reflection of how seriously the situation was taken in the country. As
a result of this, consumer confidence has not been severely dented by the event of the
pandemic, with the country’s economy expected to rebound strongly and quickly. This is all
expected to support the strong recovery of coffee sales during the early stages of the forecast
period, with many consumers likely to become increasingly willing to spend money on speciality
coffee, while category players are expected to become increasingly willing to invest in product
innovations in response to emerging consumer demands.
Foodservice operators will concentrate on developing their coffee

brands, with retail launches expected
Foodservice operators, such as Phuc Long Coffee & Tea Co Ltd with its namesake brand and
Viet Thai International JSC with its Highland brand, are expected to focus on developing their
offerings to both serve coffee shop outlets and take advantage of their strong brand names to
expand further. As such, it is expected that retail launches will also emerge over the forecast
period. Such plans show strong confidence for a recovery within on-trade channels, supported
by the previous and ongoing measures of the Vietnamese government in managing the
pandemic crisis.
Key retail players also projected to focus on innovations to meet

emerging consumer demands
Key retail players such as Nestlé Vietnam Ltd and Vinacafe Bien Hoa JSC are also projected
to continue to focus on innovations to meet emerging consumer demands – especially so within
the audience group of middle- and high-income consumers, who are willing to spend money on
high-quality speciality coffee.
Within this, it will be increasingly important for such players to ensure a robust approach to
marketing and advertising, thus to reach their desired consumer audiences in both off-trade and
on-trade channels. These leading names in coffee have identified the strong growth
opportunities which are likely to emerge during the post-COVID-19 recovery period, as the
Vietnamese economy rebounds and consumers look to make up for lost time by socialising
more often with friends and family in both on-trade and the off-trade channels.
CATEGORY DATA
Table 1 Retail Sales of Coffee by Category: Volume 2016-2021
Tonnes
2016 2017 2018 2019 2020 2021
Fresh Coffee 12,925.2 13,449.0 13,976.2 14,505.8 14,766.9 15,091.7

- Fresh Coffee Beans - - - - - -
- Fresh Ground Coffee 12,925.2 13,449.0 13,976.2 14,505.8 14,766.9 15,091.7
- Fresh Ground Coffee - - - - - -
Pods
- Standard Fresh Ground 12,925.2 13,449.0 13,976.2 14,505.8 14,766.9 15,091.7
Coffee
Instant Coffee 35,550.9 36,200.6 36,832.5 37,704.8 38,364.0 39,140.9
- Instant Standard Coffee 8,454.2 8,726.9 9,044.7 9,361.2 9,595.3 9,883.1
- Regular Instant 8,454.2 8,726.9 9,044.7 9,361.2 9,595.3 9,883.1
Standard Coffee
- Decaffeinated Instant - - - - - -
Standard Coffee
- Instant Coffee Mixes 27,096.7 27,473.7 27,787.8 28,343.5 28,768.7 29,257.8
Coffee 48,476.1 49,649.6 50,808.6 52,210.5 53,130.8 54,232.6
- Regular Instant 27,096.7 27,473.7 27,787.8 28,343.5 28,768.7 29,257.8
Coffee Mixes
Coffee Mixes
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 2 Retail Sales of Coffee by Category: Value 2016-2021
VND billion
2016 2017 2018 2019 2020 2021
Fresh Coffee 1,773.5 1,914.9 2,053.2 2,190.9 2,342.9 2,456.6

Pods
Coffee
Instant Coffee 5,713.4 6,073.2 6,444.6 6,826.3 7,361.4 7,788.6
- Regular Instant 1,948.7 2,082.6 2,227.1 2,354.9 2,534.3 2,681.2
Standard Coffee
Standard Coffee
Coffee 7,486.9 7,988.0 8,497.8 9,017.1 9,704.3 10,245.1
- Regular Instant 3,764.7 3,990.6 4,217.5 4,471.3 4,827.1 5,107.3
Coffee Mixes
Coffee Mixes
Table 3 Retail Sales of Coffee by Category: % Volume Growth 2016-2021
% volume growth
2020/21 2016-21 CAGR 2016/21 Total
Fresh Coffee 2.2 3.1 16.8

- Fresh Coffee Beans - - -
- Fresh Ground Coffee 2.2 3.1 16.8
- Fresh Ground Coffee Pods - - -
- Standard Fresh Ground Coffee 2.2 3.1 16.8
Instant Coffee 2.0 1.9 10.1
- Instant Standard Coffee 3.0 3.2 16.9
- Regular Instant Standard Coffee 3.0 3.2 16.9
- Decaffeinated Instant Standard Coffee - - -
- Instant Coffee Mixes 1.7 1.5 8.0
Coffee 2.1 2.3 11.9
- Regular Instant Coffee Mixes 1.7 1.5 8.0
- Decaffeinated Instant Coffee Mixes - - -
Table 4 Retail Sales of Coffee by Category: % Value Growth 2016-2021
% current value growth

2020/21 2016-21 CAGR 2016/21 Total

Coffee 5.6 6.5 36.8
Table 5 Retail Sales of Fresh Coffee by Regular vs Decaffeinated: % Volume 2016-2021
% retail volume
2016 2017 2018 2019 2020 2021
Decaffeinated - - - - - -
Regular - - - - - -
Total 100.0 100.0 100.0 100.0 100.0 100.0
Note: Totals may not sum to 100% due to data rounding
Table 6 NBO Company Shares of Coffee: % Retail Value 2017-2021
% retail value rsp

Company 2017 2018 2019 2020 2021
Nestlé Vietnam Co Ltd 34.5 34.7 35.3 35.3 36.1

Vinacafe Bien Hoa JSC 21.9 21.8 21.9 19.9 19.7
Trung Nguyen Corp 18.5 18.7 19.0 18.4 18.3
Fes Vietnam Co Ltd 3.5 3.6 3.6 3.4 3.5
Viet Thai International 0.6 0.7 1.1 1.1 1.1
JSC
Phuc Long Coffee & Tea 0.3 0.3 0.4 0.5 0.5
Co Ltd
Gold Roast Vietnam Co Ltd 0.2 0.2 0.2 0.2 0.2
Super Coffeemix Mfg Pte - - - - -
Ltd
Others 20.6 19.8 18.6 21.2 20.6
Total 100.0 100.0 100.0 100.0 100.0
Table 7 LBN Brand Shares of Coffee: % Retail Value 2018-2021
% retail value rsp

Brand (GBO) Company (NBO) 2018 2019 2020 2021
Nescafé (Nestlé SA) Nestlé Vietnam Co Ltd 34.7 35.3 35.3 36.1
Vinacafé (Masan Vinacafe Bien Hoa JSC 21.8 21.9 19.9 19.7
Group Corp)
Trung Nguyen Trung Nguyen Corp 12.2 12.2 11.7 11.5
G7 Instant Coffee Trung Nguyen Corp 6.5 6.8 6.7 6.7
MacCoffee (Food Fes Vietnam Co Ltd 3.4 3.5 3.4 3.5
Empire Holdings Ltd)
Highland Viet Thai International 0.7 1.1 1.1 1.1
JSC
Phuc Long Phuc Long Coffee & Tea 0.3 0.4 0.5 0.5
Co Ltd
Gold Roast (Viz Gold Roast Vietnam Co Ltd 0.2 0.2 0.2 0.2
Branz Ltd)
Klassno (Food Fes Vietnam Co Ltd 0.1 0.0 - -
Empire Holdings Ltd)
Eagle (Food Empire Fes Vietnam Co Ltd 0.1 - - -
Holdings Ltd)
Super (Super Group Super Coffeemix Mfg Pte - - - -
Ltd) Ltd
Vinacafé (Vinacafe - Vinacafe Bien Hoa JSC - - - -
Vietnam National
Coffee Corp)
Others Others 19.8 18.6 21.2 20.6
Total Total 100.0 100.0 100.0 100.0
Table 8 Forecast Retail Sales of Coffee by Category: Volume 2021-2026
Tonnes
2021 2022 2023 2024 2025 2026
Fresh Coffee 15,091.7 15,710.5 16,307.5 16,894.6 17,469.0 17,993.1

Pods
Coffee
Instant Coffee 39,140.9 40,119.3 41,131.2 42,245.2 43,469.8 44,784.6
- Regular Instant 9,883.1 10,247.1 10,572.0 10,891.4 11,206.8 11,489.2
Standard Coffee
Standard Coffee
Coffee 54,232.6 55,829.8 57,438.7 59,139.8 60,938.8 62,777.7
- Regular Instant 29,257.8 29,872.2 30,559.2 31,353.8 32,263.0 33,295.5
Coffee Mixes
Coffee Mixes
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Table 9 Forecast Retail Sales of Coffee by Category: Value 2021-2026
VND billion
2021 2022 2023 2024 2025 2026
Fresh Coffee 2,456.6 2,545.0 2,628.5 2,707.9 2,783.3 2,849.8

Pods
Coffee
Instant Coffee 7,788.6 8,046.6 8,316.2 8,613.8 8,941.8 9,289.4
- Regular Instant 2,681.2 2,774.6 2,858.3 2,941.1 3,022.9 3,095.6
Standard Coffee
Standard Coffee
Coffee 10,245.1 10,591.6 10,944.7 11,321.6 11,725.1 12,139.2
- Regular Instant 5,107.3 5,272.0 5,457.9 5,672.6 5,918.9 6,193.8
Coffee Mixes
Coffee Mixes
trade sources
Table 10 Forecast Retail Sales of Coffee by Category: % Volume Growth 2021-2026
% volume growth
2021/22 2021-26 CAGR 2021/26 Total

Coffee 2.9 3.0 15.8
trade sources
Table 11 Forecast Retail Sales of Coffee by Category: % Value Growth 2021-2026
% constant value growth

2021/2022 2021-26 CAGR 2021/26 Total


Coffee 3.4 3.5 18.5
trade sources
Table 12 Forecast Retail Sales of Fresh Coffee by Regular vs Decaffeinated: % Volume

2021-2026
% retail volume
2021 2022 2023 2024 2025 2026
Decaffeinated - - - - - -
Regular - - - - - -
Total 100.0 100.0 100.0 100.0 100.0 100.0
Note: Totals may not sum to 100% due to data rounding

Coffee in Vietnam

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Coffee in Vietnam

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Coffee in Vietnam

LIST OF CONTENTS AND TABLES

Coffee maintains A positive retail performance in 2021, thanks to A

Negative impacts to foodservice continue in 2021, due to ongoing

Nestlé maintains its top place thanks to ongoing innovation in new

PROSPECTS AND OPPORTUNITIES

Coffee is set to show stronger performance over the forecast period, as

Foodservice operators will concentrate on developing their coffee

Key retail players also projected to focus on innovations to meet

Fresh Coffee 12,925.2 13,449.0 13,976.2 14,505.8 14,766.9 15,091.7

Table 2 Retail Sales of Coffee by Category: Value 2016-2021

Fresh Coffee 1,773.5 1,914.9 2,053.2 2,190.9 2,342.9 2,456.6

Table 3 Retail Sales of Coffee by Category: % Volume Growth 2016-2021

Fresh Coffee 2.2 3.1 16.8

Table 4 Retail Sales of Coffee by Category: % Value Growth 2016-2021

% current value growth

Fresh Coffee 4.9 6.7 38.5

Table 5 Retail Sales of Fresh Coffee by Regular vs Decaffeinated: % Volume 2016-2021

Table 6 NBO Company Shares of Coffee: % Retail Value 2017-2021

% retail value rsp

Nestlé Vietnam Co Ltd 34.5 34.7 35.3 35.3 36.1

Table 7 LBN Brand Shares of Coffee: % Retail Value 2018-2021

% retail value rsp

Table 8 Forecast Retail Sales of Coffee by Category: Volume 2021-2026

Fresh Coffee 15,091.7 15,710.5 16,307.5 16,894.6 17,469.0 17,993.1

Table 9 Forecast Retail Sales of Coffee by Category: Value 2021-2026

Fresh Coffee 2,456.6 2,545.0 2,628.5 2,707.9 2,783.3 2,849.8

Table 10 Forecast Retail Sales of Coffee by Category: % Volume Growth 2021-2026

Fresh Coffee 4.1 3.6 19.2

Table 11 Forecast Retail Sales of Coffee by Category: % Value Growth 2021-2026

% constant value growth

Fresh Coffee 3.6 3.0 16.0

- Standard Fresh Ground Coffee 3.6 3.0 16.0

Table 12 Forecast Retail Sales of Fresh Coffee by Regular vs Decaffeinated: % Volume

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