In Huong Phung, Quang Tri Province in central Vietnam, the one-hectare Arabica plot farmed by Le Trang put out about 20 tonnes of fresh cherries in 2025. The average unit price at which he hands them to processors is 26,000 dong per kg (about 149 yen). When those same beans finally reach the shelf as a specialty product, they become 280,000 dong per kg (about 1,600 yen). Almost all of the tenfold gap is generated outside Huong Phung, where they are harvested. This structure, reported by the local paper Nong nghiep va Moi truong on August 24, is material for Japanese roasters and trading houses looking to buy Vietnamese Arabica to read what is happening behind the price.
What this article deals with is neither the surge in exports to China nor the tariffs against the US. It is a story of distribution — in whose hands the added value remains after the raw material leaves the production area. Once you look at the mechanism by which the production area's capacity to reinvest thins out beneath the price the procurement side thinks it "got cheap," the way contracts are structured changes.
What is sandwiched between 26,000 dong of cherries and 280,000 dong of product?
Lining up only the per-kg figures, 26,000 dong of cherries jumps to 280,000 dong of product. But this is not a same-weight comparison. Fresh cherries hold water and pulp, and the mass drops sharply at the stage of becoming green beans through pulping, drying, and hulling. Onto that are added the costs and margins of sorting, roasting, packaging, and branding. In other words, the tenfold figure is not a simple markup rate but a price stacked up by each process of processing and distribution.
The problem lies in the point that almost all of those processes are outside the farmer's plot. At the moment the cherries are sold off, Trang's share is fixed, and the production area cannot take part in the later pricing. Even if quality is improved, the markup at the cherry stage stays at 5,000 to 7,000 dong per kg (about 29 to 40 yen). If the reward for carefully picking and sorting by hand is only this much, the motive to invest in equipment or labor as a next move is unlikely to arise.
Le Trang's calculation that "make it carefully and it sells high, but the labor also grows"
Trang's words are candid. "Make it carefully and the price rises. But the labor of tending also grows by that much." This one line condenses the structure in which value does not stay in the production area. High prices attach only to lots where fully ripe cherries are picked and fermentation and drying are managed, but a premium matching that extra labor is not paid at the cherry stage. As long as there is a step between the quality buyers want and the compensation farmers receive, the production area cannot escape the way of earning through volume.
In the same Quang Tri Province, a demonstration is also under way in which returning shade trees and getting the soil and ecosystem in order raises the unit price of the beans. The flow of lifting upstream value through craftsmanship in cultivation is continuous with the on-the-ground story of Quang Tri Arabica, where returning forest to the coffee plot raises the unit price. But without a circuit to translate cultivation effort into price, the raised quality ends up absorbed into the buyer's profit.
HTX Bon Phuong's processing, and the composting of cherry pulp that runs over 146 ha
It is not that moves to keep value in the production area are entirely absent. In Huong Phung there is HTX (cooperative) Bon Phuong, which handles everything from collection through processing to packaging. The "Bon Phuong Coffee" the cooperative works on was honored in 2025 as a national-level outstanding rural-industry product, becoming a foothold for holding the processing and retail stages on the production-area side. The amount that stays in hand differs for the same beans between a farmer who handles only cultivation and a cooperative that also holds processing.
Another is the design of circularity. Within the province, at a 146-hectare demonstration zone that returns by-products such as coffee cherry pulp to fertilizer, yield rose from 7 to 8 tonnes per hectare to 12 to 15 tonnes, and input costs are said to have fallen by 2 to 3 million dong. It is the idea of turning the part that was thrown away into a resource within the raw-material area, and it faces the same direction as the decarbonization effort of turning coffee branches and leaves into a resource. A cycle that lowers fertilizer costs and raises yield is a realistic move that supports the farmer's profitability from the inside.
The stalemate in which a price guarantee and stable demand cannot stand at once
Even so, most smallholders are placed outside the cooperative's framework. The reason a farmer like Ho Thi Van, who appears in the article, cannot enter a formal partnership is that the market's absorptive capacity is insufficient. Here is the stalemate. Farmers want a price guarantee in order to invest in quality, and the cooperative and companies need stable demand in order to issue contracts. If one side moves the other would too, yet neither can step out first.
There is a ceiling on how much processing volume the cooperative can hold, and if the demand of the takers thins out, the burden of inventory and capital bounces back on the cooperative the more it widens contracts. So the ring of partnership widens only by the market's absorptive capacity. A manager at the Quang Tri Province department of agriculture and environment also acknowledges the difficulty of this partnership. Even if the government waves the flag, as long as the conventional trade of selling off cherries continues, production areas that run processing in one integrated flow will not increase. The attempt in Dak Lak Province to put beans out in the form of powder or product, a production area's attempt to steer toward processing, also runs into the same wall of a commitment on the demand side. Adding value does not advance on slogans; a long-term commitment from the buyer is the trigger.
The contracts Japanese roasters and trading houses sign move the production area's distribution
For Japan's specialty market, the Arabica of Huong Phung, including Khe Sanh, is an easy-to-handle production area with a character born of highland conditions with large day-night temperature differences. But viewing procurement through the cheapness of the cherry market means riding the very structure in which the production area's reinvestment thins out. The fact that, behind the 26,000 dong unit price, only 5,000 to 7,000 dong of a quality-improvement premium circulates asks the Japanese side to rethink what in the price they are paying for.
In practice, a contract that makes the quality premium tied to processes such as ripe-cherry picking and fermentation management explicit at the cherry stage, and that commits a multi-year offtake volume in advance, works. By partnering with a counterpart that also handles processing, like the Bon Phuong cooperative, Japanese roasters can obtain traceable beans while taking part in preserving the production area's value. Rather than negotiating to buy cheaply, designing together a price band that lets the production area invest in processing better preserves the quality and quantity of supply over the long term.
What buyers should check next
Quang Tri's Arabica does not have the flashiness of, say, durian bound for China in terms of volume. Even so, the question "after the raw material leaves the production area, in whose hands does the value remain?" repeats in every scene of sourcing Vietnamese primary products, not just coffee. Le Trang's one hectare and 20 tonnes are a microcosm of it.
- Do not judge by the cheapness of the cherry market alone; build process premiums such as ripe-cherry picking and fermentation management into the price at the cherry stage
- Choose an HTX that also handles processing and packaging (such as Bon Phuong) as your point of contact, and prioritize trades that leave added value on the production-area side
- Rather than single-year spot deals, commit a multi-year offtake volume in advance to create conditions in which farmers can move to invest in quality
- Check whether a circular model such as composting cherry pulp exists, and look at the raw-material area's cost structure and sustainability
What supports the specialty's 280,000 dong is the labor of farmers who let go of cherries at 26,000 dong. Deciding by contract where to bridge that gap is, in the end, the judgment of the side that buys the beans.
