Uganda registers decline in both quantity, earnings of coffee in November 2020 fetching US$38.61m

UGANDA – Uganda, earned US$38.61 million from exports of 519,683 bags of coffee each weighing 60kg in November 2020.

According to a report by the Uganda Coffee Development Authority (UCDA), this was a 2.09% and 9.42% decline in quantity and value respectively compared to the same month last year.

The earnings were the same in comparison to the previous month despite export of more volumes, as pricing during the period under review was 2% lower at US$1.48 per kilo compared to US$1.50 offered in October 2020.

The total exported quantity in October was 428,015 bags. The export increase is attributed to the intensification of the harvesting period in Central and Eastern regions expected to peak in December 2020 and January 2021.

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The authority has further noted that exports for the 12 months (December 2019 to November 2020) amounted to 5,399,851 bags worth US$510.02 million compared to 4,503,592 bags worth US$ 436.98 million of the previous year.

This represents 19.90% and 16.71% increase in both quantity and value respectively.

Coffee being the top earning crop of the East African nation has been experiencing tremendous growth over the years.

UCDA in a linked update has highlighted that volume of coffee exports increased by 43% from 3.557 million bags exported in FY 2015/16 to 5.103 million bags in FY 2019/20. This is the highest volume of coffee that Uganda has ever exported in the last 30 years.

Robusta coffee exports register growth while Arabica dwindles

By type, the exported amounts comprised of 372,211 bags of Robusta worth US$30.55 million. This was a 10.66% and 0.42% rise in quantity and value respectively from November 2019.

Increasing Robusta exports during the month was on account of fruition of the newly planted coffee as well as favourable weather.

 Arabica exports decreased in both quantity and value by 43.66% and 34.67% respectively fetching US$7.74 million from 58,113 bags of coffee.

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The reduction in monthly export compared to the previous year has been attributed mostly to the off-year biennial cycle characteristic of Arabica production.

Leading sellers and buyers of the month

The top 10 export companies in the country, held a market share of 73% compared to 83% the previous month, reflecting reduced concentration.

Ugacof Ltd led with a share of 16.89% compared to 13.97% last month. It was followed by Ideal Quality Commodities Ltd 10.95%; Louis Dreyfus Company Ltd 8.52%; Olam Uganda Limited 8.41%; Touton Uganda Ltd 6.71%; Kyagalanyi Coffee Ltd 6.21%; and Ibero Ltd 4.20%.

There were changes in buyers position compared to last month reflecting competition at the exporter level as Olam Uganda Ltd held the largest stake in October with 20.14% and now has come fourth.

Out of the 33 exporters that performed, 16 exported Robusta Coffee only while 4 exported Arabica coffee only.

On the other hand, the top 10 buyers held a market share of 68.93%, lower than 63.30% the previous month.

Sucafina led the pack with a market share of 15.66% compared to 12.88% in October 2020. It was followed by Olam International 10.52%; Altasheel Import & Export Enterprises 9.27%; Bernhard Rothfos 5.42%; Volcafe 5.21%; Hamburg Coffee 3.49%; Touton 3.44%; Ecom Agro Industrialist 3.06% and CCL Products 2.93%.

The destinations of Uganda’s coffee exports during the month included Italy who maintained the highest market share with 30.54% compared with 38.52% last month. It was followed by Sudan 15.58% (13.48%), Germany 14.05% (9.61%) Belgium 8.32% (5.63%) and India 7.79% (8.69%).

Coffee exports to Africa amounted to 97,418 bags, a market share of 22.64% compared to 87,384 bags (20.42%) the previous month.

African countries included Sudan, Morocco, Kenya, Algeria, Egypt and South Africa, reflecting increased continental trade which will be further boosted with the African Continental Free Trade agreement which took effect as of 1 January 2021.

Europe remains the main destination for Uganda’s coffees with 58% imports share.

Global coffee exports decline

According to the report, global coffee exports amounted to 9.7 million bags in October 2020, compared with 9.4 million in October 2019.

Exports for 12 months (November 2019-October 2020) decreased by 3.7% to 127.5 million bags from 132.45 million bags the previous period (November 2018-October 2019).

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