Rwandan coffee farmers are set to earn more from their produce thanks to a 14.8 per cent increase in farm gate price from Rwf216 in January 2020 to Rwf248 kilogramme. The new price came into force on January 20. This means that a farmer will now earn Rwf32 more from a kilogramme of coffee.
It implies that a farmer will earn Rwf32 more money per kilogramme of coffee they sell compared to the previous price.
It was set by the National Agricultural Export Development Board (NAEB) and announced in a statement issued last week by the board's CEO, Claude Bizimana.
The Rwanda Coffee Cooperatives’ Federation (RCCF), which represents coffee growers in the country, welcomed the new price, stating that it is an encouragement, especially during the challenging times occasioned by the Covid-19 pandemic.
Fulgence Sebazungu, the president of RCCF said that the farmers had been expressing concern over low coffee price which were disproportionate with their efforts.
Through the price has not yet reached the desired level for the farmers, Sebazungu said, the increment made on the coffee cherry price is commendable.
"Having the price for coffee cherries increase, instead of going down during this Covid-19 period, is a motivation to the farmers for them to get interested in taking care of their coffee trees for to more yields,” he said.
NAEB said that the farm gate price was set after it considered market price fluctuation and other factors that would influence the coffee business at large.
They include production costs and other attendant costs as well as prices at international market. US Dollar inflation and coffee pricing at New York Commodities Market are other major factors, it indicated.
For instance, NAEB pointed out that the unit price of one Kilogramme [of processed coffee] in Rwanda has increased by 12 percent, the international coffee price by 14% (beside Covid19 pandemic) while the US $ inflation increased by 5.3 percent, all in comparison to the previous season.
"This new price is expected to boost farmers’ morale, help improve production and attract more people into coffee growing,” said Pie Ntwari, NAEB’s Communication Specialist.
The biggest markets for Rwandan coffee are Switzerland, United Kingdom, United States, South Africa, Nigeria, China, Germany and South Korea.
During the 2019/2020 fiscal year, Rwanda’s coffee exports generated over $60.4 million, a decrease of about 12 percent compared to $68.7 million in 2018/2019, according to NAEB’s June 2020 report that compares the performance of the agricultural export in 2019/2020 and that in 2018/2019.
Coffee export volumes reduced by 9 percent to over 19.7 million kilogrammes in 2019/2020 from over 21.6million kilogrammes in 2018/2019. The average export price of coffee was $3.06 in 2019/2020 down from $3.18 a kilogramme in 2018/2019, a reduction of 3.7 percent.
Rwanda targets to earn $95 million from coffee exports by 2024.