Coffee earnings dropped 13 per cent in the four months to January as low international prices affected local sales.
A
market report by Nairobi Coffee Exchange (NCE) indicates the earnings
dropped from Sh5.5 billion ($55) million in October last year to Sh4.7
billion ($47 million) in the period under review. Kenya’s coffee is
mainly traded at the New York Coffee Exchange and any change in price
affects local earnings.
“The low price was caused by
international prices plummeting to the lowest level in two years from as
high of 150 cents per pound to the current 120 cents,” said NCE chief
executive Daniel Mbithi. The average price decreased from Sh25,500
($255) to Sh23,300 ($230) per 50 kilogramme bag traded at the auction.
The
volumes offered for sale also declined four per cent from 10.8 million
kilos to 10.3 million kilos, with the drop attributed to delays of the
beverage getting to the market towards the end of last year due to bad
weather.
Coffee has been performing well since the beginning of the year though, with prices going up since the first auction of 2017.
The
rally saw the value of a 50 kilogramme bag of the produce hit Sh26,418
in the latest sale held last Tuesday; the highest price in the past one
year.
NCE had predicted a series of high prices
following an increase in high quality coffee in the market. The value of
Kenyan coffee had dropped by Sh422 million in the year to December 2017
on low- quality beans.
The report indicated that the value of the crop dropped to Sh2.2 billion last year from Sh2.6 billion the previous year.
Kenya plans to raise the amount of coffee roasted locally from five to 10 per cent annually over the next five years.
But
even as Kenya seeks to expand both the local and international market,
productivity of coffee per bush has dropped from 10 kilogrammes in the
1980s to two. The government is trying to lure farmers back to tending
the crop.
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