Coffee revenue up by Sh10 billion on good harvest, prices
Coffee earnings from October last year to August 2022 jumped by Kes9.8 billion to Kes25.2 billion on account of improved local yields and favorable prices in the global market after world-leading producer Brazil suffered production setbacks due to harsh weather.
In the review period, the latest data shows the Nairobi Coffee Exchange (NCE) handled 575,543 bags of green beans, a 52 percent increase from 377,204 bags sold in the previous comparable season. The average price of a 50-kg bag edged up 6.6 percent from $279.41 last year to $297.73 this year.
NCE Chief Executive Officer Daniel Mbithi attributed the strong performance to elevated prices and higher volumes.
“Due to the increased volume and higher price, the value generated in the current season went up by $80.9 million to $210.7 million from $129.8 million in the previous period,” he said.
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The surge in international coffee prices was for the most part ascribed to reduced output in Brazil on the back of intense frost attacks that decimated large swaths of the coffee estate in the South American country, thereby triggering higher demand and, in turn, higher prices.
According to Global Coffee Report, the most severe frost in 50 years made landfall in Brazil’s coffee-producing regions between the end of June and July turning 200,000 hectares of blooming coffee estate into a wasteland covered by dead coffee shrubs.
While Brazilian coffee production might not rebound to normal levels in the near term, local farmers are already jittery about this year’s harvest following a longer-than-usual cold season which is battering the season crop slated for harvest between October and December.
The country is still in the grip of a protracted cold season which has adversely affected developing green cherries by propagating the Coffee Berry Disease (CBD) causing crop loss as the high season beckons.