CP Xinglong Coffee Raw-Material Imports at Zero Tariff, Products with Over-30 Percent Value-Added Processing Leave the Island Tariff-Free

At a Glance (China Coffee Network): CP Xinglong Coffee raw-material imports at “zero tariff”; products with processing value-added over 30% leave the island tariff-free. From “first order” to “normal”: tasting the sweetness in coffee.

CP Xinglong Coffee raw-material imports at “zero tariff”; products with processing value-added over 30% leave the island tariff-free. From “first order” to “normal”: tasting the sweetness in coffee.

On June 14, in the Wanning CP · Xinglong Coffee Cultural Park, a rich roasting aroma wafted out; a truck fully loaded with coffee products was driving out of the park, heading to the mainland market.

On December 18 last year, the first day of the Hainan Free Trade Port’s closed operation, CP (Hainan) Xinglong Coffee Industry Development Co., Ltd. (hereinafter CP Xinglong Coffee) used a “import Colombian coffee beans + domestic quality beans—Wanning Xinglong factory blended deep processing—leave island into mainland” business to win the first coffee-category processing-value-added tariff-exempt order after closed operation.

In this order, imported green beans entered the island as raw materials under the “zero tariff” list, blended with domestic coffee beans at a certain ratio, and after processing such as roasting and grinding, the product’s value-added rate exceeded 30%, and when leaving the island into the mainland market it was directly exempt from import tariff.

“Half a year has passed; we have smoothly completed multiple processing-value-added tariff-exempt orders,” said Ye Jian, general manager of CP Xinglong Coffee. From “first order” to “normal,” CP Coffee not only tasted the sweetness of the free-trade-port policy, but also explored a replicable path.

“At present, a set of standardized operating procedures has been formed, from overseas raw-material procurement, zero-tariff list matching, processing scheduling, value-added rate accounting, to island-exit customs declaration and customer delivery; each link has clear specifications,” Ye Jian said. This model can be quickly replicated to other agricultural-product processing fields.

Compared with the model before closed operation, the most intuitive change enterprises feel is in process and cost. Wang Mengjun, senior vice president of CP Xinglong Coffee, said: “After closed operation, raw-material imports are at ‘zero tariff,’ and processing value-added over 30% leaves the island tariff-free; a single order can save a certain proportion of comprehensive cost, capital turnover accelerates, and the enterprise dares to accept more customized, high-value-added large orders.”

Under the policy dividend, enterprises are also actively seeking change. In half a year, CP Xinglong Coffee adjusted its global procurement system, tilting toward producing areas in the “zero tariff” list, while optimizing domestic raw-material procurement channels; the production line was upgraded to a flexible processing system that can quickly switch different blend formulas; in capacity layout, the Wanning factory’s processing capability significantly improved; in market channels, besides traditional distributors, it directly connects with multiple national chain coffee brands and new-retail platforms.

“We are not passively waiting for policies, but actively using policies to design products and optimize the supply chain.” In Ye Jian’s view, the free-trade-port policy gives enterprises an unprecedented stage, but whether they can dance well to this tune ultimately depends on the enterprise’s own internal strength.

Ye Jian said CP Xinglong Coffee hopes to resonate with the free trade port’s frequency, “connecting the world with a cup of good coffee.” (Reporter: Lin Boxin)