Market News

Coffee prices in first fall since June

A woman picking ripe coffee beans. FILE PHOTO |
A woman picking ripe coffee beans. FILE PHOTO | NMG 

Coffee prices dipped by eight per cent this week to mark the first drop since the Nairobi auction resumed from recess in June.

A market report from Nairobi Coffee Exchange (NCE) shows a 50-kilogramme bag of the produce fetched Sh18,000 on average this week, down from Sh19,600 that was recorded in the previous trading.

NCE chief executive Daniel Mbithi says the decline was caused by a mixture of different coffee catalogues which lowered the quality.

“There was a slight decline in quality of coffee where different beans that had earlier been rejected at the auction was mixed with others, bringing down the value,” said Mr Mbithi.

He says this is a marginal decline and they expect the price to rebound in the coming sales at the auction.

Good prices recorded in previous sales resulted from an increase in volume of quality beans as the short-term crop from Eastern Kenya hit the market. The price of coffee at the auction had dipped to as low as Sh10,000 for the 50 kilo bag following a decline in quality as the main crop season from central Kenya ended ahead of June.

Kenya’s earnings from coffee dropped by Sh1.3 billion between October and March compared with the same period last year on account of low international prices and reduced volumes at the auction.

The country seeks to revive the once vibrant crop with the formation of the Kenya Coffee Platform, an initiative that brings value chain players together to develop a common approach and strategy to address the issues affecting the industry in the country.

Kenya’s coffee is majorly traded at the New York Coffee Exchange where any change in price affects the local sales.

The country plans to raise the amount of coffee roasted locally from five to 10 per cent annually over the next five years even as production remains low.