By Henry Kinyua
This week was Sale 25 of the 2023/2024 Coffee year. On Tuesday 16th April 2024, the sale took place inside the NCE trading floor and online platforms.
In this sale, 19,804 bags or 1,215,804 kgs of coffee were traded at the auction. The value of coffee traded was $6,079,556.18 or Kshs 772 Million. This was a decline from sale 24 last week where 26,813 bags or 1,643,720 Kgs of coffee valued at $8,288,180.84 or Kshs 1.1 B was traded at the auction.
Brokers
Six brokers traded coffee at the auction. Kirinyaga Slopes led the pack trading the highest volume at 36% followed by Alliance Berries at 28%, New KPCU at 17%, Kiambu Coffee Marketing at 6%, KCCE Marketing Agency Ltd at 11% and Mt Elgon Coffee Marketing Agency at 2%
The average price per bag was $250 and Alliance Berries achieved the highest average price of $260 per bag followed by KCCE at $257 and New KPCU closing at $250 per bag. Mt Elgon Coffee Marketing Agency had the lowest average price of $218 per bag.
The highest price paid for coffee was $371 per 50 kg bag or $ 7.42 per kg. This is equivalent to about Kshs 145 per kilo of cherry at the trading floor. This lot of 100 bags or 6,000 kgs of Grade AA was from Kianjiru Factory from Kirinyaga County. It was sold by Alliance Berries and bought by Kenyacof.
The top grades of AA and AB comprised 64% of the volume traded.
Rainforest Alliance (RFA) and Fair Trade (FLO) are the two certifications that growers hold. In this sale 25, a total of 3,439 bags or 17% of volumes traded were from certified growers.
Coffee Buyers
A total of 11 buyers participated in the auction. The top 5 buyers led by Louis Dreyfus Company bought 89% of the coffee presented at the auction. In the category of the least volume procured by a buyer, we had First Cup Coffee Ltd buying 67 bags.
Points to note this week
- To estimate the price per kg of cherry from these market reports let’s take $371 which was the highest price paid per bag in this sale. You multiply this number by the dollar exchange rate let’s say Kshs. 127, you then divide the number by 50 because it is 50 kgs per bag, then divide by 6.5 to get the kilos of cherry. So $371 per bag as per this report is equivalent to Kshs 145 per kg of cherry on the trading floor. This is then subjected to various deductions such as milling charges, Brokers commission (2.5% of gross), handling fees, export bags etc.
- I would like to clarify that a report of one sale doesn’t reflect the total sales and returns from any factory, cooperative or county. Coffee is harvested, pulped, dried, milled and traded at different times. Factories and estates deliver coffee to the market in multiple sales (Lots) before they can compute the final price paid for all their coffee traded. So one sale or even a couple of sales are not enough to arrive at the final price to be paid to farmers but it is a good directional indicator of how the market is performing.
