True Price and IDH, the Sustainable Trade Initiative are happy to announce the report The True Price of Coffee from Vietnam. This is a publication in a series of reports about the true price of soft commodities. The report quantifies the societal costs of coffee production in Vietnam. Key findings of the study include that 95% of the total external costs of cultivation are environmental costs, of which 28% are caused by scarce water use from over-irrigation. In addition, certified coffee has 20% lower external costs of cultivation than conventional coffee.
The results are used to inform decision making in programs designed to contribute to more sustainable coffee supply chains. By making the external costs visible for all stakeholders engaged in the Vietnamese coffee supply chain, it is possible to identify interventions that reduce external costs. This study showed that most impact can be realized by (i) improving irrigation practices to reduce scarce water use, and (ii) improving fertilizer application rates to reduce water pollution and energy use. The external costs of cultivation are relatively low for green coffee beans compared to cocoa beans (Ivory Coast) and seed cotton (India), and slightly higher than for green tea leaf (Kenya).
For more information on the true price of global commodities, click here to download the report.