By Henry Kinyua
The coffee season 2023/2024 Sale 16 took place on Tuesday 13th February 2024 at the usual place 2nd floor Wakulima house along Haile Selassie Avenue where Nairobi Coffee Exchange is located and online platforms.
A total of 27,046, bags (each 50kgs) of coffee were traded, signifying a 64% increase from the 16468 bags traded in Sale Number 15 last week.
The average price however decreased to $248 from the previous $252 per 50kg bag in Sale Number 15. This average price is equivalent to Kshs 114 per kilo of cherry.
This sale broke the $400 per bags ceiling with over 268 bags bought at above $500 per bag. The highest price achieved was $533 per 50kg bag from Kii wet mill (Factory) which is part of Rung’eto Farmers’ Cooperative Society in Kirinyaga County. KII factory had 268 bags receiving over $500 per bag.
Interestingly even last week and the week after, coffee that fetched the highest price was also from Rung’eto Farmers’ Cooperative. So, congratulations to Rung’eto FCS for keeping it high.
This high price is equivalent to Kshs 246 per Kilogram of cherry at Factory gate. An interesting and encouraging trend is emerging from this market. The number of bags receiving more than $400 per bags is increasing. Last week 4% of volumes traded fetched more than $400 per bag and in this market, 1917 bags of 7% of volumes traded fetched more than $400 per bag.
In the previous years, the number of bags fetching more than $400 was constant at 2% which was not consistent with normal market behaviours. The coffee was largely from factories in Kirinyaga county but we also had others like Kangocho and Kiamabara from Nyeri County, Kieni and Kevote from Embu county, Kirimui, Kiangoi, Ndimi, Kerugoya, Kii and Kimandi from Kirinyaga County, Gathaithi and Kangocho in Nyeri County then Kevote and Murue from Embu County
The total earnings from Sale Number 15 amounted to $8,196,958.42 or approximately Kshs. 1.2 billion. Notably, 17,522 bags, constituting 65% of the volumes traded, were grades AA and AB. Kindly note that an increase in the percentage of high grades leads to an increase in the average price and the total earnings from the market.
Kirinyaga County, represented by the Kirinyaga Slopes Coffee Brokerage Company Ltd, continued to assert its presence in the market. In Sale Number 16, they traded the highest volume at the auction with 7,809 bags of which 5335 bags or 68% of their coffee was grades AA and AB. This explains how they ended up with the highest average price of $277 per bag.
Kipkelion Broker Company Ltd from Kericho county was also active in the market trading 1,444 bags of coffee at an average price of $198 per bag.
I would like to state as always 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 only 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., $533) and multiply it by the dollar rate (e.g., 150). Then, divide by 50 (50kg per bag) and further divide by 6.5 to get the kilos of cherry. Using this formula: (533 * 150) / 50 / 6.5 = 246, the result is $4533 per bag, equivalent to Kshs 246 per kg of cherry
Brokers
Eight brokers/agents participated by presenting their clients’/farmers’ coffee for trading at the auction. New KPCU returned to the market with a thud offering 6777 bags. Kirinyaga Slopes coffee Brokerage Company presented the highest volume followed by Alliance Berries with New KPCU coming third while Murang’a County Coffee Dealers Co. Ltd traded 300 bags at an average price of $210.
Coffee Buyers
A total of 23 buyers participated in the auction. The top four buyers, were C. Dormans, Kenyacof, Ibero Kenya, Louis Dreyfus Company, and Sasini who purchased 87% of the traded coffee. Mokal Coffee Ltd procured the least volume 10 bags from the auction.
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