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Kenya: Coffee Regulator Confident of Better Crop This Season
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Business Daily (Nairobi)
20 May 2008
Posted to the web 20 May 2008
Allan Odhiambo
The coffee industry regulator is optimistic of improved crop output next season on the back of a favourable weather.
Coffee Board of Kenya (CBK) managing director Loise Njeru said projections showed that the industry could realise about 57,000 tonnes of coffee in the 2008 season, compared to 42,000 tonnes landed in the ending season.
"The flowering stage of the new crop is impressive and higher output is achievable in the new season unless major distractions such as disease outbreaks are witnessed," Ms Njeru told Business Daily in an interview.
Analysts said favourable weather conditions, coupled with improved crop husbandry, were critical at this phase of the crop's growth, raising hopes that the harvest would be better.
"The cropping capacity for the coming year is immense. The production for year 2008 is expected to grow by about 40 per cent. This is largely on account of biannual bearing cycle and improved husbandry practices especially in the estate sub-sector" the Coffee Research Foundation (CRF) said in a report.
The optimism by CBK and CRF comes in the wake of trying moments for the Kenyan coffee industry that has suffered low production over the ending season. So grave is the situation that the weekly auction will be closing earlier than its traditional break period that comes between July and September.
The industry's latest woes of short supplies can be traced back to last year when a cold spell hit most growing areas, affecting the development of berries.
Besides the cold, cases of Coffee Berry Disease (CBD) were also reported in several areas especially in upper zones of Embu, Kirinyaga, and Nyeri resulting in a revision of estimates for 2007 from 53,214 tonnes to 42,000 tonnes.
Pressed by the effects of these production set backs, officials at the NCE said an early closure remained the best option because supplies had been reduced to low quality packages.
Earlier estimates had shown that the 2008 would have been a better season with an output of about 56,000 tonnes but some critics said the estimates looked debatable given that the expected April long rains have not performed well in some areas.
Mrs Njeru however said they were confident of a better production season and were already forging new market linkages, especially for speciality coffee, to ensure growers find maximum returns for their investment.
"We are even formally signing the International Coffee Agreement this week so that the Kenyan coffee industry can have an impetus of sustainable production programmes in line with international standards.
Besides that it would improve our status of qualify for funding support for developing the industry," she said.
As the Kenyan coffee thinned in the market, the prices of the commodity in key international markets continued on a dip with the International Coffee Organisation (ICO) attributing the trend to improved supply from various countries including the leading world producer, Brazil.
Poor weather
Last week, the Brazilian government said it expected 45.5 million bags during the 2008/09 season - a 35 per cent increase from 2007/08.
It had in January projected an output of 41 million bags but steady weather patterns in most growing areas and increased fertiliser usage had boosted production. The region, which produces half of the Brazilian coffee, had witnessed poor weather patterns by the end of last year, prompting fears that this could pull down production.
"The downward adjustments to Arabica prices recorded in March were extended to all groups of coffee in April. The average of the ICO composite indicator price for April fell to US Cents 126.55 per pound, compared to US Cents 136.17 per pound in March.
Despite this decrease, price levels are still firm and price volatility has become less intense," ICO executive director Nestor Osorio said in a market report.
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The organisation however said a weakening US dollar and rising oil prices were further increasing costs in the coffee supply chain of important items such as transportation and fertilisers, a trend that could affect production in some in countries.
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