Commodities

Coffee prices decline 6pc at Nairobi auction as supply increases

coffee

Women pick coffee at a farm in Nyeri town. PHOTO | JOSEPH KANYI | NMG

geraldandae

Summary

  • The trading at the weekly Nairobi Coffee Exchange had started on a high note in the first sale of 2022 with a 50 kilogramme bag hitting a high of $345 (Sh39,000).
  • NCE chief executive officer Daniel Mbithi said the decline is marginal and that the prices are still impressive.
  • The auction is now getting high-quality beans from the main crop season that has seen an increase in premium grades from central Kenya.

The weekly coffee prices at the auction dipped six percent in the wake of an increase in supply at the market as the produce from the main season picks momentum.

The trading at the weekly Nairobi Coffee Exchange had started on a high note in the first sale of 2022 with a 50 kilogramme bag hitting a high of $345 (Sh39,000) against $324 (36,700) that it recorded this week on Tuesday.

NCE chief executive officer Daniel Mbithi said the decline is marginal and that the prices are still impressive.

“We are getting high-quality coffee from the farmers and the world prices are still good. I cannot actually tell the reason why there was a decline this week, however, the prices are still impressive,” said Mr Mbithi.

The auction is now getting high-quality beans from the main crop season that has seen an increase in premium grades from central Kenya.

Coffee prices enjoyed relatively good prices in the last crop season with a 50 kilogramme bag of the commodity trading above $300 (Sh33,900) in the whole of last year as well as at the beginning of the current season that started in October.

Monthly coffee earnings rose to a record $50 million (Sh5.6 billion) in December as Kenya reaped from the frost that destroyed the crop in Brazil and the civil wars in Ethiopia, reducing supplies in the world market.

NCE said the earnings jumped 117.3 percent from $23 million (Sh2.6 billion) in the corresponding month a year earlier, buoyed by the challenges suffered by the two leading producers.

Brazil, which is the top world supplier, produces up to 60 million kilos of the beverage every year but the harsh weather conditions saw the Latin American nation lose up to 20 percent of its entire crop this season.

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