Tanzania Agriculture Development Bank boosts coffee production with US$3.3m

TANZANIA – Tanzania Agriculture Development Bank (TADB), state-owned development finance institution has released Sh7. 7billion (US$3.3m) to coffee farmers cooperative unions to facilitate production in the 2020/21 season.

The cooperative unions to benefit from the funding are Kagera Cooperative Union (KCU) and Karagwe District Cooperative Union (KDCU) in Kagera region, northwest of Tanzania, the country’s main growing region of Robusta coffee.

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TADB managing director Mr Japhet Justine presenting the funds highlighted that the bank has now reduced interest rates from 12 per cent to 9 per cent aimed at reducing costs and increase productivity for farmers, reports The Citizen.

Kagera Regional Commissioner Marco Gaguti said that so far the region produces 45 per cent of the country’s coffee output. “We collected 52 million Kg of coffee in 2019/2020 season which fetched Sh 84 billion (US$36.2m) and the goal for 2020/21 is to collect 60 million kilograms,” he said.

The United State of Agriculture Department on its Tanzania’s coffee annual report 2020 describes the coffee market as volatile and faces dramatic political hurdles and unstable policies.

The report forecasts an increase in production from 1.25 million bags in MY 2019/2020 to 1.35 million bags in MY 2020/2021 due to favourable weather conditions in all coffee growing areas and across the crop cycle.

On the other hand it forecasts a 16 percent decrease in the country’s total coffee export in MY 2020/2021 due to low quality, changes in the marketing system, and restrictions in movement due to COVID-19 outbreak.

There is no expected change in domestic coffee consumption due to consumer preference for tea, which comes in part due to the high price of coffee compared to the price of tea.

The annual per capita coffee consumption in the country is 0.06 kg, and only seven percent of the country’s total coffee production is consumed domestically.

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