"Kopi (the Indonesian word for coffee) Luwak comes from the islands of Sumatra, Java and Sulawesi (formerly Celebes), which are part of the Indonesian Archepelago's 13,677 islands (only 6,000 of which are inhabited). But it's not strictly the exotic location that makes these beans worth their weight in silver. It's how they're "processed."
On these Indonesian islands, there's a small marsupial called the paradoxurus, a tree-dwelling animal that is part of the sibet family. Long regarded by the natives as pests, they climb among the coffee trees eating only the ripest, reddest coffee cherries. Who knows who first thought of it, or how or why, but what these animals eat they must also digest and eventually excrete.
Some brazen or desparate -- or simply lazy -- local gathered the beans, which come through the digestion process fairly intact, still wrapped in layers of the cherries' mucilage. The enzymes in the animals' stomachs, though, appear to add something unique to the coffee's flavor through fermentation."
Marsupial Coffee