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homephotos Newsbuzz NewsHow Brazil and Vietnam are tightening their grip on the world's coffee

How Brazil and Vietnam are tightening their grip on the world's coffee

SUMMARY

A towering machine rumbles through the fields of Julio Rinco's farm in the Brazilian state of Sao Paulo, engulfing whole coffee trees and shaking free beans that are collected by conveyor belts in its depths. This automatic harvester is one of several innovations that have cut Rinco's production costs to a level that few who use traditional, labour-intensive methods can match. With increasing use of mechanization and other new technologies, the world's top two coffee producers, Brazil and Vietnam, are achieving productivity growth that outstrips rivals in places such as Colombia, Central America and Africa. They are set to tighten their grip. A plunge in global coffee prices in recent months, to their lowest levels in 13 years, has begun to trigger a massive shake-out in the market in which only the most efficient producers will thrive, according to coffee traders and analysts. Rival producers elsewhere in the world are increasingly likely to be driven to the margins, unable to make money from a crop they have grown for generations. Some are already turning to alternative crops while others are abandoning their farms completely. Such shifts are almost irreversible for perennial crops like coffee, as the decision to abandon or cut down trees can hit production for several years.

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By Reuters Aug 22, 2019 1:50:06 PM IST (Updated)

Listen to the Article(6 Minutes)
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Julio Rinco operates a harvesting machine in a coffee plantation in the town of Sao Joao da Boa Vista, Brazil, June 6, 2019. REUTERS/Amanda Perobelli/Files

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Coffee cherries are seen in a plantation in the town of Sao Joao da Boa Vista, Brazil June 6, 2019. REUTERS/Amanda Perobelli/Files

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Roasted coffee beans are seen at the coffee company of Simexco Dak Lak Limited in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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A weather station is seen as workers enter a coffee plantation in Sao Sebastiao do Paraiso, Brazil April 22, 2019. REUTERS/Amanda Perobelli/Files

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Colombian coffee grower Jose Eliecer Sierra picks coffee fruits at a plantation in Pueblorrico, Colombia March 11, 2019. REUTERS/Luisa Gonzalez/Files

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A worker picks coffee fruits at a plantation in Pueblorrico, Colombia March 11, 2019. REUTERS/Luisa Gonzalez/Files

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Recently harvested coffee fruits are seen at a plantation in Pueblorrico, Colombia March 11, 2019. REUTERS/Luisa Gonzalez/Files

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A farmer shows an irrigation management system app on his mobile phone at a coffee plantation in Sao Sebastiao do Paraiso, Brazil April 22, 2019. REUTERS/Amanda Perobelli/Files

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Recently harvested coffee fruits are seen at a plantation in Pueblorrico, Colombia March 11, 2019. REUTERS/Luisa Gonzalez/Files

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Thai Anh Tuan (L) a manager of Simexco Dak Lak Limited coffee company tastes coffee at his office in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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A worker shows coffee green beans at coffee company Simexco Dak Lak Limited in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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A worker is seen at a coffee warehouse of the coffee company Simexco Dak Lak Limited in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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Labourers work at a coffee warehouse of coffee company of Simexco Dak Lak Limited in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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A harvesting machine harvests coffee in a plantation in the town of Sao Joao da Boa Vista, Brazil June 6, 2019. REUTERS/Amanda Perobelli/Files

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Coffee is being tasted at Simexco Dak Lak Limited coffee company in the town of Di An in Binh Duong province, Vietnam July 8, 2019. REUTERS/Yen Duong/Files

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