UNDP, ISPAE launch Handbook on Circular Economy Models in Coffee Production

The handbook “Handbook on Circular Economy Models in Coffee Production” contributes to achieving the objectives set out in Decision No. 540/QĐ-TTg dated 19 June 2024, which approved the Programme for the development, application, and transfer of science and technology to promote the circular economy in agriculture. The information provided is aligned with the requirements of the European Union Deforestation Regulation (EUDR).

Coffee production plays a vital role in Vietnam’s socio-economic development, providing direct employment for more than 600,000 farmers and supporting over 2.6 million jobs.

However, coffee production is also a resource-intensive, high-emission sector, contributing significantly to agricultural greenhouse gas emissions. In 2024, Vietnam’s total coffee cultivation area reached 718,000 hectares, with an annual output of more than 1.95 million tonnes.

Since most of Vietnam’s coffee is dry-processed, and assuming each kilogram of green coffee beans generates a nearly equivalent amount of husk, an estimated 1.6 million tonnes of dry husk are produced each year. This is an important resource for making high-quality organic fertilizer.

Circular economy models in the coffee sector can simultaneously reduce emissions, recycle waste, improve soil health, and strengthen climate resilience, as demonstrated in the Central Highlands and northern provinces of Vietnam. There are existing examples and good practices that need to be scaled up.

Accordingly, the Handbook introduces four high-impact circular economy models for coffee production, validated through expert interviews and field assessments. These include: intercropping coffee with avocado, durian, persimmon, pepper, and macadamia; producing organic fertilizer from coffee husks; small-scale wastewater treatment; and large-scale biogas wastewater treatment. It also outlines the benefits of three circular models for coffee production and technical steps to implement them, which ideally equip farmers, coffee production stakeholders, and policymakers to adopt carbon emission models on the ground. 

Readers are provided with technical guidance and step-by-step instructions, accompanied by illustrative images, to support farmers and cooperatives in adopting these practices.

All models deliver proven economic and environmental benefits, such as:

- Intercropping coffee with avocado, durian, pepper, persimmon, and macadamia: Diversifies income, increases carbon sequestration, and raises net present value (NPV) by 57% compared with monocropping.

- Producing organic fertilizer from coffee husks: Converts 45% of dry coffee cherry waste into nutrient-rich compost, reducing reliance on chemical fertilizers and lowering costs.

- Small-scale wastewater treatment: Low-cost biological systems help reduce pollution from wet processing of arabica coffee.

- Large-scale biogas wastewater treatment: Generates profits for processing plants, with an internal rate of return (IRR) of 28-34% and an NPV of up to VND 983 million over 15 years.

To support emission reduction goals in agriculture, the Handbook also outlines three priorities for coffee production. First, producers need to optimize fertilization using improved nutrient formulas and adjusted application rates to reduce N2O emissions.

In addition, energy efficiency should be enhanced across the entire supply chain, from mechanization to processing and logistics to reduce CO2 emissions. Sustainable production models, including agroforestry, renewable energy, and low-impact processing technologies, should be promoted throughout the value chain.

Circular practices in coffee production will directly contribute to Vietnam’s NDC target of reducing emissions by 15.8% unconditionally, and by 43.5% with international support by 2030.

To improve coffee sustainability, added value, and quality, in recent years MAE, local authorities, and the private sector have supported coffee producers in engaging in certification schemes such as 4C, UTZ, Rainforest Alliance, and other organic certifications that foster sustainable practices.

In 2022, the certified coffee area (including VietGAP, 4C, Rainforest, and UTZ) was about 185,800 hectares, accounting for approximately 26 per cent of the total coffee area. Certified coffee areas are mainly in large-scale, specialized coffee production areas such as Lam Dong (about 76,000 ha), Dak Lak (about 45,600 ha), Dak Nong (23,500 ha), and other provinces in the Central Highlands region. The Central Highlands region, where most coffee is grown, has seen some growth in sustainable certifications, though it still accounts for only a small share of total production. The Central Highlands is Vietnam’s largest robusta coffee-producing region, accounting for over 95% of the country’s coffee output.

Access the Handbook on Circular Economy Models in Coffee Production here.