The HK Coffee Market Summary (Sale 11 of 9th Jan 2024)

By Henry Kinyua

Welcome to the latest edition of the HK Coffee Market Summary!

In the second week of 2024, the coffee season opened with Sale Number 11. This event took place on January 9th at the Nairobi Coffee Exchange’s usual spot on the 2nd floor of Wakulima House along Haile Selassie avenue and online. A total of 17,298 bags of coffee were traded, a bit less than the 23,167 bags in the previous Sale 10.

The average price per 50 kg bag increased from $194 in Sale 10 to $197 in Sale 11. This average price is equivalent to Kshs 90 per kilo of Cherry. Gathaithi FCS secured the highest price at $401 per 50 kg bag, selling 70 bags of AA coffee to C. Dormans Ltd. This high price equates to Kshs 181 per kg of cherry. The total earnings from Sale 11 were $4,141,559.04 or Kshs 654 M.

Kirinyaga County, through Kirinyaga Slopes Coffee Brokerage Company Ltd, continued to make an impact. In Sale 11, they traded 2,831 bags at an average price of $214 per bag, equivalent to Kshs 97 per kg of cherry at the factory gate. The highest price paid for Kirinyaga coffee was $309 per bag from Kimandi, bought by Louis Dreyfus Company.

It’s important to note that one sale doesn’t represent the total sales and returns from any factory, cooperative or county. Coffee goes through various stages before reaching the market, so multiple sales are needed to determine the final price paid to farmers. These sales give us a good idea of how the market might perform.

Also to estimate the price per kg of cherry from these market reports, lets say 401 which was the highest price paid per bag in this market. Multiply this number by the dollar exchange rate lets say 158. You then divide the number by 50 because it is 50 kgs per bag, then divide by 7 to get the kilos of cherry- some factories and farms achieve better conversion ration of even 1:6 but lets use 7 for the general average (401 x 155) = 63358/50 = 1267/7 = 181. So $401 per bag as per this report is equivalent to Kshs 181 per kg of Cherry.

Coffee Brokers

In Sale 11, eight brokers participated, with New KPCU leading with 5,296 bags, followed by Alliance Berries with 4,213 bags. Bungoma Union Marketing Agency returned with 442 bags at an average price of $192 per bag.

Here’s a breakdown of the brokers and their contributions:

Coffee Buyers

On the buyer’s side, a total of 20 buyers participated, with Taylor Winch (Coffee) Limited leading acquiring 21% of the traded coffee. The top five buyers, including Kenyacof at 18%, C.Dormans at 13%, Ibero at 13%, and Louis Dreyfus Company at 9%, bought 74% of the coffee. Super Gibs Ltd purchased the least, with only 5 bags.

Here’s the list of buyers and the number of bags they acquired:

In essence, Sale Number 11 provides a snapshot of the diverse dynamics within the coffee market. Stay tuned for more updates as we navigate the ever evolving landscape of coffee trading. By the way happy new year, this is the only chance I have to say it!