THE amount of coffee procured at the Moshi exchange increased slightly to 6,768 bags compared to 5,840 bags sold in the previous session (equivalent to 15.8 per cent change), the trend that describes deteriorating prices of the commodity in the world market.
However, the amount supplied at the auction increased to 18,359 bags compared to 15,699 bags offered in the previous session. Likewise, the overall average price at Moshi exchange were up by 2.68 US dollars for a 50 kgs (about 4,288/-) for Mild Arabica.
The last market held early February last month saw decline of price by 8.28 US dollars (about 13,248/-). But the average prices were below the terminal market by 10.80 US dollars (17,280/-) for a 50 kgs for Mild Arabica.
The New York (NY C) March delivery were down by 3.25 US dollars cents (about 5,200) equivalent to 3.58/50 cents US dollar (about 5,728/-) for a 50 kgs bag Freight on Board (FOB).
The March delivery for the London International Financial Futures and Options Exchange (LIFFE) market was down by 45 US dollars (about 72,000/-) per metric tonnes equivalent to US dollars 2.25 US dollars (about 3,600/-) of a 50 kgs bag FOB compared with the auction held in the previous auction.
The bumper coffee harvests expected in Brazil of about 50 million bags as compared to 45 million bags last season has continued to pose threats to the local producers as the market will be over supplied. Likewise, Columbia is expected to have premium crop of high output, where Tanzania coffee belongs to the same group.
Due to the increased output, the market is therefore switching from bullish to bearish where the price of stocks is decreasing. Tanzania, Africa's fourth-largest coffee producer after Ethiopia, Uganda and Ivory Coast, produces mainly Arabica and some robusta coffee.
Prices of its Arabica normally track the New York market while those of robusta take their cue from London. Coffee production was one of the traditional cash crops which contributed to the increase of export volumes in the year ending January this year.
According to the Bank of Tanzania (BoT) monthly economic review, coffee exports gained 186.6 million US dollars (about 298.6bn/-) in 2012 compared to 142.6 million US dollars in the previous period.