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Vietnam's Covid-19 Outbreak Threatens to Disrupt Global Coffee Supply Chains

It's one of many industries to see major disruptions.

In addition to causing immense physical and financial suffering for countless people, Vietnam's ongoing COVID-19 outbreak is wreaking economic havoc, with the lucrative coffee sector now facing challenges as well.

The Guardian reports that social distancing measures in Saigon, Vietnam's main economic hub; and the Central Highlands, where most of the country's coffee is grown, have disrupted the supply chain and are threatening the world's second-largest coffee exporter.

The Vietnam Coffee-Cocoa Association has asked the government to lessen restrictions, as traders are having a hard time getting their beans to ports in order to be shipped.

Vietnam is responsible for around 20% of the European Union's coffee imports and the outbreak here, combined with poor weather which damaged coffee crops in Brazil, has driven prices for both arabica and robusta beans to their highest levels in years. 

The news source adds that Vietnam's transport minister has called for streamlined processes for the shipment of agricultural goods like rice and coffee, but transportation remains a huge hurdle across the country.

Bloomberg further reports that an ongoing shipping container shortage, along with extremely high shipping rates, are exacerbating export problems — and not just for the coffee sector.

Coffee exports earn Vietnam about US$3 billion a year, with the industry aiming to double that figure to US$6 billion by 2030.