By Henry Kinyua
Welcome to this weeks’ edition of the HK Coffee Market Summary: Sale number 19
The coffee season 2023/2024 sales 19 took place on Tuesday 5th March 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 26,328 bags (each weighing 50kgs) of coffee were traded, signifying a 13% decrease from the 30,272 bags traded in Sale Number 18 last week. The average price decreased by 20% to $232 from the previous $290 per 50kg bag in Sale Number 18. This average price is equivalent to Kshs 103 per kilo of cherry. The highest price achieved was $498 per 50kg bag from Kii wet mill (Factory) in Kirinyaga.
This high price is equivalent to Kshs 222 per kilogram of cherry at Factory gate. In this sale, 831 bags or 3% of volumes traded fetched more than $400 per bag.
The top 10 coffee lots were from factories in the counties of Kiambu, Embu, Nakuru and Kirinyaga. These includes: Kii (Rung’eto FCS) from Kirinyaga whose coffee fetched the highest price and Kiangoi also part of Rung’eto Farmers’ Cooperative Society, Karinga and Karatu (Gitwe FCS) from Kiambu, and Kabingara from Karithathi Farmers’ Cooperative Society.
The total earnings from Sale Number 19 amounted to $7,510,865 or approximately Kshs 1.1 billion. Notably, 18,007 bags, or 68% of the volumes traded were grades AA and AB.
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.
If you are a coffee farmer, find out which broker is handling your coffee then follow and see how many lots are presented and prices they fetched. Do this until all the coffee from your factory and cooperative have been sold. Sum it all up to establish amounts paid for your coffee, then follow up deductions at factory level to arrive at the final price paid to farmers.
To estimate the price per kg of cherry from market reports, take the highest price paid per bag (e.g., $498) and multiply it by the dollar rate (e.g., 146). Then, divide by 50 (50kg per bag) and further divide by 6.5 to get the kilos of cherry. Using this formula: (499 x 145) / 50 / 6.5 = 222. So, $498 per bag ~ $10 per Kg of clean coffee, equivalent to Kshs 222 per kg of cherry.
Brokers
Nine brokers/agents presented their clients’/farmers’ coffee for trading at the auction. Kirinyaga Slopes continued to shine at the auction leading the pack with their coffee fetching the highest average price. They delivered 6,914 bags to the market and sold all at an average price of $247. Alliance Berries delivered and sold the second highest volume at an average price of $234. New KPCU presented 5,111 bags at an average price of $231 per bag. KCCE Marketing Agency sold the 4th highest volumes with 2246 bags at an average price of $239. Meru County Coffee Marketing Agency ltd returned to the auction trading 1176 bags at an average price of 224. Kiambu Coffee Marketing Limited also traded 1248 bags at an average price of $243.
From the Rift Valley and Western regions, we had Kipkelion with 1,011 bags at an average price of $207, Kinya coffee marketing agency that trades coffees largely from Kisii region also presented 1309 bags at an average price of $179. United Eastern Kenya Coffee Marketing Co Ltd that largely sells coffee from Machakos and neighboring regions returned to the market trading 692 bags at an average price of 199.
Coffee Buyers
A total of 24 buyers participated in the auction. The top six buyers, led by C.Dormans purchased 88% of the coffee presented. Others included Ibero Kenya, Kenyacof, Louis Drefus Company, Sasini and Taylor Winch. Coffee Bee Processors procured 12 bags which was the least volume procured by one buyer from the auction.
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