By Henry Kinyua
Welcome to this week’s edition of The HK Coffee Market Summary. Sale number 26
This week we had sale 26 of the 2023/2024 Coffee year on Tuesday 23rd April 2024 which took place inside the NCE trading floor and online platforms.
In this sale, 26,449 bags or 1,620,930 Kgs of coffee were traded at the auction. The value of coffee traded was $7,888,906 or Kshs. 1 billion. This was a significant increase from sale 25 last week where 19,804 bags or 1,215,804 Kgs of coffee valued at $ 6,079,556 or Kshs. 808 Million were traded at the auction.
Brokers
Eight brokers traded coffee at the auction. Alliance Berries led the pack by trading the highest volume of 36% followed by Kirinyaga Slopes at 25%, New KPCU at 20%, Kipkelion at 9%, KCCE Marketing Agency Ltd at 7%, Kiambu Coffee Marketing at 3%, Kinya Coffee Marketing Agency at 3% and and United Eastern Kenya Coffee Marketing Co Ltd at 1%.
The average price per bag was $243. New KPCU achieved the highest average price of $ 273 per bag followed by Alliance Berries at $ 267 and Kiambu Coffee Marketing Limited at $256 closing at $ 250 per bag. United Eastern Kenya Coffee Marketing Co Ltd had the lowest average price of $ 208 per bag.
The highest price paid for coffee was $ 455 per 50 kgs bag or $ 9.1 per Kg. This is equivalent to about Kshs. 186 per kilo of cherry on the trading floor. This lot consisting of 43 bags or 2,588 kgs of grade AA was from Konyu Factory which is part of Kabare Farmers Cooperatives Society from Kirinyaga County. It was sold by Alliance Berries and bought by Diamond Coffee Company Limited.
Other factories whose coffee fetched more than $ 400 per bag are Karatina, Ndaroini, Kagumo, Guama, Gaturiri, Iyego and Mukengeria.
The top grades AA and AB comprised 58% of the volume traded. Rainforest Alliance (RFA) and Fair Trade (FLO) are the two certifications that growers hold. In this sale, 2,807 bags or 11% of volumes traded were from certified growers.
Coffee Buyers
A total of 18 buyers participated in the auction. The top 4 buyers led by Ibero Kenya bought 81% of the coffee presented. In the category of the least volume procured by a buyer, we had Global Mark Foods Ltd buying 10 bags.
Points to NOTE this Week
1. To estimate the price per kg of cherry from these market reports let’s say $ 455 which was the highest price paid per bag in this market, you multiply this number by the dollar rate let’s say 133. 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 $455 per bag as per this report is equivalent to Kshs. 186 per kg of Cherry at 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.
2. 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.
