The value of coffee sold through Kenya’s auction fell 9 per cent to Sh8.5 billion ($85 million) in the half-year to March due to lower volumes and prices, a senior official said on Monday.
The east Africa nation sold coffee worth Sh9.3 billion ($93.2 million) in the first-half of the 2014/15 crop season that runs from October to September.
“The volume of crop was lower in the first-half and this coupled with the price trend in New York reflected on the overall earnings,” Daniel Mbithi, chief executive of the Nairobi Coffee Exchange told Reuters.
Kenya’s coffee prices track those of arabica in New York.
Kenya, whose high-quality beans are sought by roasters to blend with beans from other producers, exports about 90 per cent of its coffee through the exchange, and the remainder is sold to foreign buyers directly.
Officials said 324,585 bags of 60-kg each were sold in the six months to March compared with 328,401 the previous year.
The average price dipped to $214.51 per 50-kg bag from $232.4 in the previous year. East African coffee is normally packed in 60-kg bags but the prices are quoted for quantities of 50 kg.
“We shall be keeping an eye on New York because it will be a key determinant as the season progresses” Mbithi said.
Coffee exports were at one time Kenya’s leading foreign exchange earner but have slipped to under 50,000 tonnes a year in recent years from a record level of 130,000 tonnes in 1987/88.
Many smaller coffee farmers, disillusioned with poor earnings, switched to other crops or sold land for real estate.
Credit: Business Daily