The logo showing Juan and Conchita first appeared in 1981 as part of efforts to advertise one of Colombia's main exports.
Colombia's coffee federation uses the logo as a seal of guarantee.
"I feel like a flag, like a national anthem," said Mr Sanchez as he told a news conference about his memories of playing the iconic coffee grower since 1969, including meeting Bill Clinton and the Spanish royal family.
Mr Sanchez said touring the world advertising Colombian coffee had become too tiring.
From a field of 400, Colombia's coffee federation has narrowed the choice to replace Mr Sanchez down and will announce the new Juan Valdez in June.
The younger Juan will be "humble but proud of Colombia's coffee", Gabriel Silva, president of the National Federation of Coffee Growers said.
He will be used to promote the drink to today's consumers, focusing on its quality and the fact that it is grown in environmentally sound conditions, Mr Silva said.
But some things will not change. "He has to have a bushy moustache," Mr Silva said.

Juan Valdez - one of the most famous Colombians of all time