Home ECONOMY Gloom for producers as coffee earnings drop Sh2.6bn on falling prices

Gloom for producers as coffee earnings drop Sh2.6bn on falling prices

by biasharadigest
Market News

Gloom for producers as coffee earnings drop Sh2.6bn on falling prices

Daniel Mbithi
NCE chief executive officer Daniel Mbithi. FILE PHOTO | NMG 

Coffee earnings dropped Sh2.6 billion at the end of the 2018/2019 crop year compared with the previous period as low price at the international market continued to hurt farmers.

A market report by the Nairobi Coffee Exchange (NCE) indicates that the crop earned Kenya Sh10.2 billion in the year ended June, down from Sh12.8 billion realised in 2018.

NCE chief executive officer Daniel Mbithi says the low earnings resulted from a consistent trend in New York, where Kenya trades nearly all of its beans.

“The earnings dropped on account of the dipping in prices at New York terminal, which touched a record low of 86 US cents per pound in 2019 compared with a high of 120 last year,” said Mr Mbithi.

Subsequently, the average price went down by 24.67 percent from Sh21,000 as at the end of last crop season, to Sh15,000 for a 50-kilo bag in the period under review.

Coffee’s main crop season normally comes to an end in June with another starting in October with the onset of harvesting in eastern and western Kenya.

The volume sold during the review period was up by 1.8 million tonnes compared with last year by the time main crop ended.

“The season 2018/2019 enjoyed a higher number of sales from 29 sales in 2017/2018 to 34 sales due to the higher volumes that were offered for sale,” he said. The Coffee Directorate has urged Kenyans to consume more coffee and cut reliance on exports to cushion the price from external shocks.

Kenya has one of the best coffees in the world. But since early 1990s to 2010/11 crop year, area under coffee has declined by 35 percent from 170,000 hectares to 109,795 hectares as farmers abandoned the crop.

Related Posts

Leave a Comment