19 September 2017

Kenya: Income From Coffee Rises 10% on High Price

Coffee earnings in the year to August rose by 10 per cent on strong pricing, helped by a scramble for the smaller volume available at the weekly auction.

A prolonged drought into the first-half of the year affected production in key growing areas, lifting demand of the commodity.

Data from Nairobi Coffee Exchange (NCE) showed the country earned Sh15.3 billion in the period under review compared with Sh13.9 billion realised in a corresponding time last year, representing a 10 per cent growth.

The volume of coffee offered for sale at the auction was however lower at 31 million kg as at August, down from 35 million sold over a similar window last year.

"Better prices were realised in July this year resulting from high competition as traders competed for the little volumes of coffee available at the auction," says NCE in a statement.

NCE attributes the decline in quantities on drought mainly in the main growing regions of Mount Kenya.

The exchange is suffering low volumes of coffee to trade, a move that saw the auction suspended last month after it had resumed from a one-month break.

According to NCE, there is a significant drop of coffee from farmers in the eastern part of the country which is supposed to be supplying beans now.

The auction took a break on May 23 as the main crop from Central Kenya came to an end, which saw a sharp decline in the quality of coffee at the auction.

About 85 per cent of the Kenyan coffee is sold through the auction with the remaining percentage sold direct to buyers in overseas.

The government has been pushing for direct sales to enable growers earn much from their crop by eliminating the middlemen who exploit farmers when their crop goes through the auction.

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