Kenya’s coffee exports down in 2004/05, earnings up

By David Mageria

NAIROBI (Reuters) – Kenya’s coffee exports dropped by 11.4 percent in the 2004/05 (Oct-Sept) crop year, but earnings rose steeply compared with the previous season, boosted by high global prices, officials said on Thursday.

Preliminary statistics from the state-run industry regulator, the Coffee Board of Kenya (CBK), said Kenya exported 40,218 tonnes of coffee in the year ended September 2005, compared with 45,418 in 2003/04.

Higher global prices lifted coffee export earnings to 8.2 billion shillings in 2004/05 from 7.1 billion shillings the previous year.

Kenyan coffee prices per tonne jumped to 203,936 Kenya shillings compared with 157,101 shillings.

“Prices were up because the international market for coffee was up, so Kenya got the (improved) prices,” Charles Cardoso, managing director of CETCO Limited coffee exporters, told Reuters.

Coffee traders said the figures from CBK were not up to date because the board depended on shippers to supply it with their export data, but most delayed doing so for many months.

Kenya produces some of the world’s top coffee grades used by roasters in blending with coffee from other origins and heavily sought after by specialty markets in Europe and the United States.

Germany was by far the biggest market for Kenya’s coffee, buying 10,330 tonnes in 2004/05, followed by Sweden with 5,152 tonnes and then the United States, Belgium and Britain.

DROUGHT

Coffee officials expect production in 2005/06 to jump to 65,000 tonnes from around 50,000 previously.

But Julius Kinoti, the technical services manager at the coffee board, told Reuters that drought in some parts of the country could slash output.

“The rainfall did not come as expected so we are unlikely to achieve the target (of 65,000 tonnes),” he said.

There were no new estimate because the board had yet to carry out an assessment, Kinoti said.

Kenya’s President Mwai Kibaki was this week forced to declare food shortages that have hit the arid north and some coastal areas due to poor rains a national disaster.

Kinoti said higher coffee prices are unlikely to translate quickly into higher production because it took time for peasant farmers, who had abandoned coffee in favour of other crops, to return to the sector.

“The prices are good. But that is not reflected immediately, the following year is when you see the impact,” Kinoti said.

Kibaki has promised to boost agriculture production through reforms but farmers say changes in the sector have been slow.

Kinoti said the government had put the right policies and legal framework in place to ensure the coffee sector thrived and farmers were paid well.

The government has waived debt owed by farmers, agreed to allow direct coffee sales to markets abroad and plans to establish a coffee development fund, Kinoti said.

“The government is doing a lot to rehabilitate the coffee industry,” he said. “Once the business environment is improved, it is the private sector to contribute by investing in the industry, not the government.”