The HK Coffee Market Summary (Sale 12 of 16th Jan 2024)

By Henry Kinyua

Welcome to this weeks’ edition of The HK Coffee Market Summary: Sale number 12.

The coffee season 2023/2024 sales 12 took place on Tuesday 16th January 2024 at the usual
place 2nd floor Wakulima house along Haile Selassie avenue where Nairobi Coffee Exchange is
located and online.

A total of 24,150 50kg bags of coffee were traded, signifying a significant increase from the 17,298 bags traded in Sale Number 11 the previous week. The average price also saw an uptick, reaching $198 from the previous $197 per 50kg bag in Sale Number 11. This average price is equivalent to Kshs 90 per kilo of cherry. The highest price achieved was $391 per 50kg bag from Kii, a factory under Rungeto FCS. This factory sold 171 bags of AA at a price ranging from $326 to $391 and was procured by Louis Dreyfus Company. This is equivalent to 173 Kshs per Kg of cherry. The total earnings from Sale Number 12 amounted to $5,818,472 or approximately Kshs 902M, compared to $4,141,559.04 or Kshs 654M in Sale Number 11. Notably, 14,151 bags, constituting 59% of the volumes traded, were grades AA and AB.

Kirinyaga County, represented by the Kirinyaga Slopes Coffee Brokerage Company Ltd, continued to assert its presence in the market. In Sale Number 12, they traded 4,340 bags at an average price of $251 per bag, equivalent to Kshs 120 per Kg of cherry at the factory gate. The highest price paid for Kirinyaga coffee in Sale Number 12 was also the highest in this sale at $391 per bag from Kii Factory, a part of Rung’eto Farmers’ Cooperative Society, bought by Louis Dreyfus Company. Out of the 4,340 bags presented by Kirinyaga, 3,136 bags, or 72%, were top-grade AA and AB, explaining the higher average price per bag from this county.

It’s crucial to note that a report on a single sale doesn’t reflect the total sales and returns from any factory cooperative or county. Coffee is processed and traded at different times, and factories present coffee to the market in multiple sales before determining the final price paid for all their traded coffee. Therefore, one sale or even a couple of sales serve as directional indicators of market performance.
To estimate the price per kg of cherry from market reports, take the highest price paid per bag
(e.g., $391) and multiply it by the dollar rate (e.g., 158). Then, divide by 50 (50kg per bag) and further divide by 7 to get the kilos of cherry. Using this formula: (391 * 158) / 50 / 7 = 173, the
result is $391 per bag, equivalent to Kshs 173 per kg of cherry

Eight brokers/agents participated by presenting their clients’/farmers’ coffee for trading at the
auction. Alliance Berries took the lead with 6,766 bags, followed by New KPCU trading 6,352
bags of coffee. United Eastern Kenya Coffee Marketing Company Ltd returned to the market
with 1,129 bags traded at an average price of $174 per bag.

Coffee Buyers
A total of 23 buyers participated in the auction. The top six buyers, led by Ibero at 22%,
purchased 84% of the traded coffee. Other notable buyers included Kenyacof, C.Dormans,
Taylor Winch, and Louis Dreyfus Company and Sasini. In this sale, a lot of 26 bags of grade C
from Mokua Estate did not attract any bids. Kyandu Trading Company purchased the least
volume, acquiring 10 bags at the auction.

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