Improved coffee prices in international market boost Uganda’s, Kenya’s export earnings

Uganda coffee export

UGANDA – Uganda’s Coffee exports in August 2022 amounted to 501,054 60-kilo bags worth US$71.15m, comprising of 456,271 bags of Robusta valued at US$60.26m and 44,783 bags of Arabica valued at US$10.89m.

According to the monthly coffee report issued by the Uganda Coffee Development Authority (UCDA), this was a fall in both quantity and value by 28.52% and 5.25% respectively compared to the same month last year.

It was also a drastic decline in earnings and export volumes compared to July when the country earned US$83.52m from export of 576,468 bags.

By comparing quantity of coffee exported by type in the same month of last Coffee Year, Robusta decreased by 28.31 % and 7.65% in quantity and value respectively. Arabica exports decreased by 30.60% in quantity but increased by 10.59% in value.

“The decrease in exports and earnings can be blamed on lower yields this year that was characterized by drought in most regions,” reads part of the report, adding, “This led to a shorter main harvest season in Central and Eastern regions and also reduced harvests from Greater Masaka and South-Western regions.”

Meanwhile, the country’s coffee exports in the 12 months (September 2021- August 2022) totalled 5.93 million bags worth US$871.76m compared to 6.41 million bags worth US$607.82m the previous year. This represents a decrease of 7.49% in quantity but an increase of 43.43% value.

During the period under review, Italy maintained the highest market share of 39.67% compared with 40.62% last month. It was followed by Germany 13.83%, Sudan 10.20%, India 7.75%, and Belgium 5.62%.

Coffee exports to Africa amounted to 93,988 bags, a market share of 19% compared to 118,694 bags, 21% of the previous month.

African countries that imported Uganda coffee included Algeria, Sudan, Morocco, Tunisia, South Africa, Somalia, Egypt, Libya and Kenya.

Meanwhile in neighbouring Kenya, the country’s coffee earnings in the 11 months to August 2022 increased by Ksh9.8 billion (US$81 million) boosted by higher volumes and better prices in the international market on the back of a shortfall in supply from leading producer Brazil.

Data from the Nairobi Coffee Exchange (NCE) shows returns in the period hit Ksh25.2 billion (US$210 million) compared to Ksh15.5 billion (US$129 million) in the 11 months to August 2021.

The number of bags sold through the auction grew by 52.58 percent from 377,204 in the previous season to 575,543 as at the end of the review period, with the average price per kilogramme increasing from US$279.41 last year to US$297.73 per 50-kilogramme bag this year.

“Due to the increased volume and higher price, the value generated in the current season went up by US$80.9 million to US$210.7 million from US$129.8 million in the previous period,” said Daniel Mbithi, chief executive officer NCE.

The improved performance was also influenced by a global supply shortage caused by frost in Brazil and bad weather in Colombia that impacted the crop negatively.

Brazil has been facing record crop failures due to cold weather and drought, and in Colombia, rains destroyed part of the crops while Ethiopia witnessed instability in the Oromo region, impacting production.

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