[alephnerd]

> Most abandoned coffee farming and converted their farms into prime real estate

This is happening in Vietnam as well (2nd largest coffee producer in the world).

Coffee margins are low because there are too many farmers and too few bulk purchasers, so most fermers have either switched to higher value nuts (eg. Macadamia) or sold the land off to tourism developers who can make a "Glam-Camping" experience for Korean, Japanese, or Thai tourists.

[yowayb]

Does this also have something to do with Vietnam being mostly robusta?

[alephnerd]

Nope.

Robusta is the primary choice across much of Asia. Vietnamese are heavy coffee consumers (so the domestic market is strong) and VNese coffee is cost-competitive in Japan and SK due to FTAs.

Furthermore, for historical reasons Robusta cultivars tend to be very popular across Asia (just like the Phin or Filter Coffee - the metal apparatus for drip coffee is part of the Colonial Era exchange across Asia - or chicory coffee mix)

It's just about money. Too many farmers entered the coffee industry in the 1990s and 2000s as it was the cash crop of choice back then, and there are a handful of larger wholesalers who cornered purchasing.

Nuts make way more money than coffee because of better margins and lower cost of inputs. A lot of this is also driven by Food Processors, as VN cornered the nut processing market (eg. most nuts from sub-Saharan countries like Côte d'Ivoire get exported to VN for processing) so there was excess capacity.

[throwaway2037]

    > most nuts from sub-Saharan countries like Côte d'Ivoire get exported to VN for processing

Wow, that is crazy to think about. Exporting from one developing country to another -- on the other side of the planet, no less! Why can't Côte d'Ivoire do the processing themselves? That sounds like a great business opportunity. GDP per capita is about 30% lower in Côte d'Ivoire, so labour costs might also be cheaper.

[alephnerd]

> Why can't Côte d'Ivoire do the processing themselves?

Capital.

Historically, Asian LDCs like Vietnam and Cambodia have had access to Japanese and Korean development loans and grants which allowed for businesses to build and innovate.

Most Sub-Saharan economies did not have those kinds of capital markets.

Depending on where you are in Africa, the Gulf, Turkey, India, and China have stepped in to fill the capital gap, but they tend to be much more extractive in their terms.

[kalleboo]

Maybe it's similar to the "Grown in Argentina, packed in Thailand, sold in USA" pears issue https://www.youtube.com/watch?v=0aH3ZTTkGAs

[ReptileMan]

>Why can't Côte d'Ivoire do the processing themselves?

Their civil war ended in 2010, Vietnam's in 1970-s

[randomcarbloke]

this was likely due to the French whose coffee was traditionally robusta from their African territories, they almost certainly introduced coffee to Vietnam when they held it.