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Brazilian Vice President Geraldo Alcomin and Chinese coffee roasting and retail giant Lakin Coffee this week signed a Memorandum of Understanding (MoU) for a trade deal involving the purchase of around 120,000 tonnes of Brazilian coffee.
According to Brazil’s state news agency AgênciaBrasil, the deal will equate to about $500 million in coffee exports. According to recent estimates from the USDA’s Foreign Agricultural Service (FAS), for the 2024/25 market year, this will represent approximately 5% of Brazil’s total annual export earnings.
By comparison, Brazil’s coffee exports to China for the full year 2023 were $280 million. China recently surpassed the United States as the country with the largest number of coffee shops, with an estimated 50,000.
Lakin Coffee said it has more than 16,000 stores across China, making it the largest domestic coffee chain ahead of competitors such as Starbucks (about 6,800 stores, by the end of 2023) and Koti Coffee (about 7,000 stores by March 2024). By the third quarter of 2023, Lukin Coffee was opening an average of 16.5 stores per day.
The company operates two major production roasteries in China, including a recently inaugurated $120 million facility in Kunshan. The Brazilian news agency described the company as “the primary importer of Brazilian coffee in China”.
Facilitated by ApexBrasil, the Brazilian export promotion agency, the coffee agreement is one of 12 memorandums of understanding signed to increase Brazil’s presence in Asian markets.
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