Global coffee supplies hit by Vietnam’s fresh Covid-19 lockdown

Vietnam's biggest city Ho Chi Minh | Photo credit: D Mz via Pixabay

The exporting hub of Ho Chi Minh, which is part of the global network that operates from China to Europe, has been under strict travel restrictions following a surge of Covid-19 delta variant cases. 
 

According to a BBC report, Vietnam's exporters are struggling to transport goods, including coffee beans, to ports for shipment around the globe. The Vietnam Coffee-Cocoa Association    has urged the country's government to ease restrictions to avoid further disruption. 
 

Vietnam's transport minister Nguyen Van The ordered officials last week in the south of the country to ease burdens on the transport of goods, according to the report. 
 

Vietnam, which is currently the world’s largest producer of robusta coffee, has seen wholesale robusta coffee prices rise by roughly 50% in 2021. 
 

The restrictions are the latest of many challenges facing the global coffee industry this year. 
 

A shortage of shipping containers and rising freight costs has led to significant supply chain issues worldwide following 18 months of pandemic disruption.
  

Moreover, coffee farmers in some regions of Brazil have been severely impacted by the worst draught in 90 years and the strongest frosts since 1994, which has caused the price of coffee to surge to its highest level in seven years. 
 

Rising coffee prices has been felt unevenly across the industry. 
 

In July 2021, Starbucks said it had locked in its coffee prices for its business year to September 2021, as well as the following financial year. As such, the coffee giant will not feel the effects of higher prices in the international commodity markets. 
 

Other companies, however, have had to raise retail prices. US coffee and snacks maker J.M. Smucker and German coffee brand Tchibo announced price increases in order to counteract rising coffee costs.