In June 2025, nearly 20 tons of Ugandan Robusta green coffee beans arrived in Chengmai, Hainan, via container cargo across the Indian Ocean—the first full container of "zero-tariff" coffee beans imported under Hainan Free Trade Port (FTP) policies by Hainan Yuanfeng Food Co., Ltd. At the Caicun Coffee Factory in Fushan Town's Caicun Village, these coffee beans transitioned from zero-tariff imports to value-added processed products, eventually becoming instant coffee or drip bags for markets in Inner Mongolia, Xinjiang, Sichuan, and other regions on the Chinese mainland.

Caicun Coffee Factory is Yuanfeng Food's deep-processing base and has been operational since 2021. Tallying up the figures, company executive Xu Qujun stated, "Under Hainan FTP policies, green coffee beans are exempt from customs duty, import VAT, and consumption tax. The 8% tariff reduction thanks to value-added processing here in Hainan, combined with other import cost optimizations and the 'dual 15%' corporate and individual income tax rates, can lower overall costs by 30% to 40%."

How does Hainan's policy toolbox support this cost structure? The Hainan FTP implements a two-tier customs supervision system known as "freer access at the 'first line' and regulated access at the 'second line'." The "first line" refers to the boundary between the FTP and areas outside the Chinese mainland's customs territory, while the "second line" refers to the regulatory boundary between the FTP and other regions within the mainland's customs territory. Over 6,600 commodities, including raw coffee beans, entering Hainan (crossing the "first line") are exempt from customs duty, import VAT, and consumption tax. When enterprises import raw materials and process them in Hainan, the resulting products are exempt from tariffs when entering the mainland (crossing the "second line") as long as the total value added is at least 30%.

Xu explained, "The amount we save in duties gives us more room in pricing and logistics. We are a typical 'straight in-straight out' enterprise that imports raw materials from overseas and mainly sells the finished products to the Chinese mainland. This qualifies for the Hainan FTP’s tariff exemption policy for value-added processing."

As Hainan's main coffee-producing region, Chengmai County is becoming an industrial hub for implementing FTP policies. The policy dividends are directly reflected in business expansion: in 2025, over 9,110 tons of coffee beans and related products were imported into Hainan, a year-on-year increase of more than 5.6 times. The value of these imports reached 480 million yuan, an increase of 8.3 times year on year. Yuanfeng Food also plans to build a new factory, which is expected to start production in the second half of 2026. It will add new product lines such as freeze-dried powder and sports coffee, and gradually expand its raw bean procurement network in India, Southeast Asia, and other regions.

Amid global trade uncertainties, Hainan FTP is proactively engaging with the world through its well-defined open rules and policies. The "zero-tariff" journey of a humble coffee bean illustrates how the FTP brings global resources together to achieve high levels of openness.

Executive Producer: Shang Lin

Chief Producer: Niu Xiaomin

Creative Producer: Zhou Yuan

Producers: Chen Shuhuan Wang Jingxuan

Production Coordinator: Chen Xiaodan

Written By: Chen Xiaodan

Video Editor: Zhou Chenguang

Cameraman: Qiu Honggao

Visual Effects: Yan Lechi

Translator: David Janke

Designers: Yan Lechi Liang Yuzheng

Copy Editors: Shang Yingxi Chen Xiaodan