zlacker

>>sebg+(OP)
Growing up in Nairobi, it took only a 20-minute ride to visit the vast coffee farms in areas like Kiambu, Limuru, and others nearby areas. These farms were located less than 10 kilometers from the city center, many of them close to the edge of the Aberdare mountain ranges. In the mid-1990s, when I was in primary school, we were taught that Kenya was a leader in coffee and tea production, and I used to consume coffee almost daily. Then, all of a sudden, it seemed like one scandal after another emerged—farmers were not being paid, and the industry became overrun by brokers and middlemen. This meant local farmers were cut off from selling their coffee at competitive market rates and instead had to deal with corrupt government officials and brokers. So, what did the farmers do? Most abandoned coffee farming and converted their farms into prime real estate. Remember, these farms were near the mountain slopes, making the land highly valuable. These new houses became popular with the UN and foreign nationals from Europe and the US, who sought refuge from Nairobi’s “heat.” As a result, more coffee farms were converted into real estate, and today these areas feature some of the most expensive properties in Kenya. For instance, $200,000 would now be considered cheap for a three-bedroom apartment.

>>Diazna+Ok1
> 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.

>>alephn+yC1
Does this also have something to do with Vietnam being mostly robusta?

>>yowayb+KH1
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.

>>alephn+kI1

    > 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.

>>throwa+AO1
>Why can't Côte d'Ivoire do the processing themselves?

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