Commodities

Coffee prices on fourth consecutive fall at auction

coffee

A farmer tends to his coffee bushes in Nyeri town on November 9, 2021. PHOTO | JOSEPH KANYI | NMG

geraldandae

Summary

  • Nairobi Coffee Exchange said the price this week dropped to Sh34,917 down from Sh37,117 for a 50 kilogramme bag realised in the previous sale.
  • Most of the high-quality coffee was offered for sale at the beginning of the main season in November and farmers are now delivering lower-quality beans.
  • The auction had been receiving high-quality coffee from central Kenya since November last year, coming as a major boost to prices at the auction.

The weekly coffee prices at the auction continued to perform dismally on the back of lower quality crop at the market.

Nairobi Coffee Exchange said the price this week dropped to Sh34,917 down from Sh37,117 for a 50 kilogramme bag realised in the previous sale, marking the fourth straight time that the value of the beverage has been on a decline.

“There was a drop in the price on account of lower quality as compared to the previous auction,” said Daniel Mbithi, the chief executive officer of NCE.

Mr Mbithi said most of the high-quality coffee was offered for sale at the beginning of the main season in November and that farmers are now delivering lower-quality beans.

The auction had been receiving high-quality coffee from central Kenya since November last year, coming as a major boost to prices at the auction.

The volume of coffee at the auction this week dropped to 29,000 bags from 31,500 bags of 50 kilo each in the previous sale.

Kenya’s top-grade coffee-AA dropped to a price of Sh39,550 from Sh42,827 that a 50-kilo bag fetched at the auction last week.

Grade AB, which is ranked second in terms of the quality fetched Sh34,239 from Sh36,000 in the previous sale.

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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