In Dak Lak Province in Vietnam's Central Highlands, known as a major coffee production area, an attempt to grow cacao under a "low-emission" banner has gotten underway. On July 2, 2026, a training session gathering farmers from four local communes was held, and a demonstration model of 23 farms over 18.5 hectares was launched. The aim is to connect production, fermentation, processing, and export in a single chain, with its sights set on the markets of Europe, the United States, and Japan. It is as if a small Asian production area has thrown its name into a chocolate-ingredient procurement map that has leaned toward West African product. For Japanese confectionery makers and raw-material trading companies too, the outline of a third candidate area has come into focus.
The demonstration model launched in Dak Lak Province
Driving this effort are Cacao Land, which handles cacao cultivation; LPF Fund, which handles the financing side; and the Dak Lak Province Agricultural Extension Center, which handles technical guidance. The targets are four communes: Ea Ba, Duc Binh, Song Hinh, and Ea Ly. Twenty-three farming households run 23 demonstration farms, and 20,350 cacao seedlings were distributed across a total of 18.5 hectares. The program runs from May to December 2026, with the July 2 training session the starting point of farmer education.
The pillars of the technique shown at the training were reducing chemical fertilizer and increasing organic matter, integrated pest management (IPM), water-saving irrigation, and carbon fixation through intercropping combined with shade trees. Digitizing production records to secure traceability was also included. In step with this, LPF Fund plans to develop collection points, a fermentation center meeting international standards, and a digital management platform. The feature is that rather than ending with handing out seedlings, it tries to prepare receptacles for everything from collection to fermentation and processing at the same time.
Why is a coffee production area turning to cacao now?
Dak Lak Province has made its name as the heart of Robusta coffee. Behind that coffee production area putting effort into cacao lies a structural change in the raw-material market. The global cacao market hit a record high in the first half of 2025 and has continued to swing wildly since, still carrying supply anxieties. As the main West African production areas struggle with erratic weather and aging trees, eyes for raw-material procurement have begun to turn to production areas in Asia and Latin America that more easily meet traceability and cultivation conditions.
Another driver is the EU's deforestation regulation (EUDR). From December 30, 2026 onward, products such as cacao handled within the EU will be required to prove they have not destroyed forest since the end of 2020. Raw material unable to assemble the production area's location information and evidence of non-deforestation risks being shut out of the European market. That the Dak Lak demonstration flies ESG standards, traceability, and carbon credits from the start can be read as an aim to turn this wall of regulation from an "entry condition" into a "weapon of differentiation." Precisely because it is a latecomer, there is room to build a production area designed to fit the regulation.
The strength and sense of scale of Dak Lak cacao
Vietnamese cacao is small in scale but has a history of being valued for quality. It received fine-flavor (high-quality cacao) production-area certification from the International Cocoa Organization (ICCO), and the Trinitario variety(lineages such as B14 and B10) representative of Dak Lak is highly rated by makers abroad for its fresh fruitiness and floral aroma. Bean-to-bar makers using this land's beans, such as the Ho Chi Minh City-based brand Marou, have also grown up.
In figures, cacao planting across Dak Lak Province is around 1,140 hectares, with annual output of about 1,525 tonnes. The province has several processing companies that export to Japan and Europe, and a track record of supply to Japan has built up. This demonstration's 18.5 hectares is only a tiny part seen against the production area as a whole. But as a pilot that brings in the design philosophy of "low emission" and "integrated processing," it becomes a touchstone for the production area's next form.
| Item | This demonstration | Dak Lak Province overall (reference) |
|---|---|---|
| Planted area | 18.5ha | About 1,140 ha |
| Players | 23 households, 23 farms | Several processing companies (exports to Japan and Europe) |
| Seedlings distributed | 20,350 | — |
| Period | May–December 2026 | — |
| Design philosophy | ESG, low emission, integrated processing | Quality-focused (fine flavor) |
Figures are from local announcements and various reports. Production-area-wide figures such as planting area and annual output can vary by period.
The local and industry reception
From farmers who took part in the training come cautious hopeful voices wanting to see whether yields can be kept while reducing dependence on chemical fertilizer, and whether fermentation can be handled within the production area. Because cacao's flavor is greatly shaped by the skill of post-harvest fermentation and drying, the concept of preparing a fermentation center rather than ending at collection carries, for farmers, the meaning of an "outlet where beans can be sold high."
Industry views roughly split into three. First, a positive assessment that production-area building that gets ahead of regulatory compliance is a good chance to push up export unit prices. Second, a sober point that at a scale of 18.5 hectares it is still far from commercial lots, and that the speed of expansion and the sustainability of funding will be tested. Third, a realistic concern over how to resolve the contest with coffee over land and labor. All of these are also the flip side of the production area trying to compete on "quality and provability" rather than "volume."
What it means for Japanese raw-material procurement
For Japanese confectionery makers and raw-material trading companies, this move takes effect from two angles. One is diversifying procurement away from a single West African pole. Amid awareness of single-production-area risk from market swings and tighter regulation, an Asian production area designed on the premise of traceability can serve as a receptacle for craft and high-value-added lines that seek "beans with a face" even in small volumes.
The other is a change in raw-material form. If an integrated model where the production area handles fermentation and processing functions, the Japanese side gains the possibility of receiving fermented beans or semi-processed goods together with traceability information, rather than green beans. In Dak Lak, coffee too is showing moves to step up from exporting beans to exporting powder and processed goods. If the production area advances to the same "process and ship out" stage in cacao, the Japanese procurement side will need to review how it writes specifications and designs inspection. The production area's processing evolution The day Buon Ma Thuot's beans come out as "powder": how Japanese procurement moves is a structure that overlaps with the coffee flow depicted there.
Ripple effects on the market and neighboring production areas
The Dak Lak cacao demonstration gains clearer perspective when grasped not as a standalone point but as part of the flow in the Central Highlands of "not selling raw material but processing it and shipping it out." In the same Dak Lak Province, a fruit-processing cluster has gotten underway, and the production area has entered a stage of stepping into the downstream of processing (see Dak Lak Province launches a fruit-processing cluster). The current of flying low emission and ESG as banners is also spreading ahead in rice and other crops.
If this design starts to turn in cacao, the mold of "regulation-compliant production-area building" could ripple to nearby small production areas. For Japanese buyers, it means a future image in which raw material with the production area's location information and non-deforestation evidence in order from the start comes continuously out of Southeast Asia. EUDR is a European regulation, but beans from a production area designed to fit it pass easily in the Japanese market too in terms of provability.
What practitioners can do now
There are three moves raw-material procurement and product-development staff can take first. First, order samples of Vietnamese fine-flavor cacao on a small-volume, high-value-added line and check whether the flavor suits your own roasting and recipes. Second, confirm early with the supply side whether it can provide traceability information (production-area location, cultivation method, fermentation history). Third, sound out whether procurement of fermented beans or semi-processed goods is possible, and keep green-bean-premised specifications flexible.
Advancing processing on the production-area side is happening simultaneously in coffee and fruit too. Cacao is merely the latest example. Related moves also show in Son La Arabica and other differentiation by variety and quality, suggesting that Vietnamese agriculture as a whole is shifting its footing from "volume to quality and provability."
Summary
Dak Lak's 23 farms and 18.5 hectares is, in scale alone, a small step. But production-area building that builds in the design of ESG, low emission, and integrated processing in advance is also an experiment to create raw material that passes in the post-EUDR world. For Japanese confectionery and raw-material players, it is not the stage to reach a conclusion now but the time to size up "whether it can be used" through obtaining samples and confirming traceability. There is ample value in putting one option other than West Africa into practical view.
