Nairobi – The price of coffee has declined by 19 per cent in the last three auctions as the volume of quality beans on sale dwindled. In last week’s auction, a 50 kilogramme bag of the commodity traded at Sh18,584, down from Sh22,927 the previous week.
The price of coffee had been going up since January because of quality beans from central Kenya. Farmers from the region have been harvesting their main crop since November last year but the main season is expected to come to an end in the coming two months.
Nairobi Coffee Exchange (NCE) chief executive officer Daniel Mbithi said the decline in quality had affected the “good prices” witnessed in the last three months.
“The prices have declined because of low quality beans coming in from the farmers at the moment as the main crop season almost comes to an end,” said Mbithi.
He expects high quality coffee from July when the crop from eastern Kenya will be ready for harvesting.
Coffee remains a major cash crop and top foreign exchange earner for the Kenyan economy and is ranked the fifth largest contributor to the gross domestic product (GDP) after horticulture, tourism, tea and diaspora remittances. In the 2013/14 crop season, a total of 671,438 bags were traded at the NCE, realising $174.1 million in revenues compared to 625,170 bags sold in the 2012/13 season valued at $127.1 million, improving farmers’ earnings from the auction by about 37 per cent in total revenues.
The industry contributes about 0.2 per cent of the Kenyan GDP, about eight per cent of the total agricultural export earnings and up to 25 per cent of the total labour force employed in agriculture.