Local demand for coffee hit, but exports still stable in Myanmar

Demand for coffee produced in Myanmar has declined in fiscal 2019-20 due to COVID-19 disruptions, said U Myint Swe, director from the Ministry o Agriculture, Livestock and Irrigation.

“Even though stockpiles this year were sufficient, demand has fallen due to difficulties in logistics and shipping as well as the closure of businesses locally as a result of COVID-19,” he said.

Myanmar coffee businesses estimate that local demand for coffee has dropped by almost half with restaurants forced to close and people staying at home.

Daw Lay Lay Myint, Managing Director for Genius Coffee Group, a local coffee maker and cafe operator, said the business was forced to sell its coffee at a discount.

“We buy our coffee once a year in advance. This year, we had already bought 200 tonnes of coffee beans but COVID-19 happened unexpectedly and demand dropped by half. We had also planned to expand to new markets and bought extra raw materials,” she told the Myanmar Times last month..

Now, Genius Coffee is offering discounts to its customers. If they buy K100,000 worth of roasted coffee, they will get K200,000 worth. This will not only help it offload some stock, it will also help some of its customers, the company said.

While local demand has taken a hit, international interest in Myanmar coffee has been less volatile.

U Ye Myint, vice chair of the Myanmar Coffee Association and founder of Mandalay Coffee Group, the country’s largest high-end coffee bean exporter with annual exports exceeding US$1 million, told the Myanmar Times last month that the exports of Myanmar specialty coffee has not been impacted much and will increase in the near future despite the pandemic.

He said richer countries have already begun to recognise the potential of Myanmar coffee and that the major challenge for the local coffee industry is to improve the quality of coffee beans so that it meets international standards.

In Myanmar, coffee beans are cultivated in Pyin Oo Lwin and Mogok in Mandalay and Ywarngan and Nawngcho in Shan. These have been exported to the US, Japan, the UK and Europe, where demand for high-quality coffee has been rising.

In the past five years, the value of coffee exported has quadrupled to over US$6 million this year from US$1.5 million in 2014, according to the Myanmar Coffee Association.

In fiscal 2018-19, Myanmar exported around 1000 tonnes of coffee beans. These are priced from US$1 to US$8 per kilogram, but specialty coffees can go as high as US$9 per kg.

The country’s 50,000 acres of coffee plantations produce over 8000 tonnes of beans annually, 80pc of which is higher value arabica beans, while the rest is lower grade robusta, which is mainly used in instant coffee mix. The coffee plantations can be found in northern states like Kachin and Shan, as well as in Mandalay Region.

The association on October 1 participated in the Singapore Specialty Coffee Online Auction 2020, which provides a platform for global coffee bean producers to promote and introduce their beans to an Asian market, using Singapore as a hub.

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Source : Myanmar Times

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