Vietnam’s coffee industry has established itself as a key player in the global market, showcasing strong productivity, logistics efficiency, and impressive export volumes. By 2025, the country saw export revenues exceeding US$8 billion, largely driven by robust prices and growing demand for processed coffee products.
The export volume reached approximately 1.5 million tonnes, with roasted and processed coffee exports generating over US$1 billion within the first eight months of the year.
However, the industry is currently facing significant challenges in complying with the European Union Deforestation Regulation (EUDR), particularly in terms of providing verifiable geospatial and land-use data. This is particularly problematic in a landscape dominated by smallholder farmers.
“The primary issue lies in achieving plot-level traceability and land legality verification within fragmented networks of smallholder farmers. Many of these farms, characterized by their small size and dispersed locations, often lack consistent record-keeping,” explained Lily Tran, business development lead at Koltiva, a sustainable agriculture and supply chain traceability firm.
Under the EUDR, coffee must be traceable back to individual plots and verified as deforestation-free, requiring auditable data that includes geolocation and historical land use.
A recent survey by Forest Trends and Tavina revealed that nearly 60% of smallholders do not maintain consistent harvest records, and only about 10% have plot-level data, resulting in a considerable data gap that affects the entire supply chain.
“In practice, the critical differentiator is not certification logos but rather access to verifiable, auditable data,” Tran emphasized.
She further reiterated that certifications alone do not fulfill EUDR requirements, highlighting that the regulation places substantial emphasis on auditable geospatial and supply-chain data.
“Currently, certifications serve more as a supportive layer rather than standalone proof of compliance. Exporters must complement certificates with robust digital traceability systems to meet EU standards,” she added.
While digital traceability platforms are gaining traction, their effectiveness in addressing challenges remains limited.
“Digital traceability provides strong support for mapping, record-keeping, and supply-chain integration. Nonetheless, technology alone cannot resolve issues related to land legality, farmer training, or institutional data alignment. Its efficacy improves significantly when coupled with cooperative organization, governance support, and standardized data practices. Essentially, digital tools, while vital, are insufficient on their own,” said Manfred Borer, co-founder and CEO of Koltiva.
A ‘Hidden Bottleneck’
Tran pointed out that land legality often represents a crucial issue that is frequently overlooked.
“Land legality can act as a hidden bottleneck. Even if a farm is deforestation-free, it could still face compliance challenges if ownership or land-use documentation is insufficient. Thus, enhancing local record systems and improving registry alignment is just as vital as environmental verification,” she stated.
With EUDR deadlines fast approaching, European buyers are becoming increasingly selective in their sourcing practices, prioritizing exporters who can demonstrate compliance quickly and transparently.
“Early indications suggest a trend of supplier consolidation, particularly among European importers who favor partners capable of exhibiting compliance rapidly and transparently. This could narrow partnerships toward exporters with robust documentation and data infrastructure. Exporters lacking plot-level verification may struggle to sustain or grow their EU contracts,” Borer noted.
Despite this tightening landscape, experts believe that Vietnam will not lose its status as a significant coffee supplier to the EU.
“Vietnam is likely to maintain its importance as an EU supplier but will undergo a gradual structural shift. Instead of a sudden drop in export volumes, a more likely scenario involves a dual pathway: exporters who invest in verifiable compliance systems will garner premium and long-term contracts, while others may continue to cater to more price-sensitive markets. This transition will focus on increasing the proportion of compliance-ready and value-added offerings rather than decreasing total volumes,” Tran explained.
She concluded that Vietnam’s challenges under the EUDR are largely administrative and governance-related rather than agronomic.
“In comparison to more structured origins like Brazil, Vietnam faces more significant administrative and land documentation difficulties. Nevertheless, it is also ahead of other less organized origins where systemization is insufficient. The disparity primarily revolves around digital and governance issues, which can be rapidly bridged with the right traceability platforms and cooperative capacity-building initiatives,” Tran commented.
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