China’s Largest Coffee Chain Establishes Exclusive Coconut Island in Indonesia

China’s largest coffee chain Luckin Coffee has signed an agreement with Indonesia’s Banggai Islands Regency, making it the exclusive premium origin of coconut milk for its flagship Coconut Latte, the VnExpress International reported on March 24.  

The memorandum of understanding it signed with the regency provides Luckin Coffee and its partners with exclusive rights to procure coconuts from the region, the firm announced earlier this month. The Banggai Islands are among the world’s top coconut-producing regions.

Under the agreement, the islands will be named “Luckin Exclusive Coconut Island,” according to Global Times.  The chain intends to source roughly one million tons of raw coconut materials, which comply with its quality standards, over the next five years. 

Luckin Coffee, headquartered in Xiamen, a port city in southeastern China, currently dominates China’s coffee market with over 21,000 stores nationwide as of September, outselling U.S giant Starbucks.  It has also been expanding overseas, setting up its first Southeast Asian store in Singapore in April 2023 and later increasing its number of outlets in the city-state to 38, the report said.