Coffee ready for export
Uganda’s Coffee exports in April 2021 amounted to 537,538 60-kilo bags worth US$ 50.02 million (Shs176.76bn), Uganda Coffee Development Authority (UCDA) report reveals.
The April UCDA Report says this comprised 464,544 bags of Robusta valued at US$39.08 million and 72,994 bags of Arabica valued at US$ 10.94 million.
“This was an increase of 49.19% and 35.38 % in quantity and value respectively compared to the same month last year. By comparing quantity of coffee exported by type in the same month of last Coffee Year (April 2020), Robusta increased by 76.64% and 73.09% in quantity and value respectively,” the report says.
It adds: “On the other hand, Arabica exports decreased in both quantity and value by 24.98% and 23.86% respectively. Just like last month, the decrease in Arabica monthly exports compared to the previous year is attributed mostly to the off-year biennial cycle characteristic of Arabica production,” UCDA report reveals.
It adds that the increasing Robusta exports during the month was due to newly planted coffee which has started yielding supported by favourable weather.
“This was also compounded by a positive trend in global coffee prices which influenced exporters to release their stocks. The decrease in value of Arabica coffee was due to low volumes exported,” the report adds.
It further reveals that coffee exports for the 12 months (May 2020-April 2021) amounted to 5,825,562 60-kilo bags worth US$ 536.09 million compared to 4,934,801-kilo bags valued at US$ 478.71 million the previous year.
This, the report says, represents 18.05% and 11.99% increase in both quantity and value respectively.
Exports by Type and Grade
The average export price was US$ 1.55 per kilo, 1 cent lower than US$ 1.56 per kilo realized in March 2021, the report says.
It adds that Robusta exports accounted for 86.42% of total exports lower than 86.28% in March 2020. The average Robusta price was US$ 1.40 per kilo, 2 cents higher than the previous month.
On the other hand, washed Robusta fetched the highest price of US$ 1.93 per kilo, a premium of 38 cents over Screen 18, and it was followed by Screen 14 sold at an average price of US$ 1.75 per kilo.
The share of Sustainable/washed coffee to total Robusta exports was only 0.43%. The report adds that Arabica fetched an average price of US$ 2.50 per kilo, 15 cents lower than in March 2021.
The highest price was Organic Drugar sold at US$ 6.65 per kilo, followed by Sustainable Arabica Fully Washed Sipi Falls sold at US$ 4.37 per kilo. Drugar was sold at US$ 2.36 per kilo, a discount of 41 cents from Bugisu AA.
The share of sustainable Arabica exports to total Arabica exports was 8.7%. Drugar exports had a 61% of Arabica exports compared to 36% the previous month.
The high percentage of Drugar exports to total Arabica exports in April compared to the previous month led to a reduced Arabica value, the report says.
Individual Exporter Performance
According to the report, Ugacof (U) Ltd had the highest market share of exports with 15.17% compared to 13.89% in March 2021. It’s important to note that the figures in brackets below represent percentage market share held in March 2021.
Ugacof was followed by Olam Uganda Ltd 15.14% (10.98%); Touton Uganda Ltd 10.59% (8.70%); Louis Dreyfus Company (U) Ltd 7.83% (9.15%) Ideal Quality Commodities Ltd 7.71% (11.14%); Kawacom (U) Ltd 6.73% (6.09%); Kyagalanyi Coffee Ltd 5.58% (7.60%); Grainpulse Ltd 4.11% (3.40%); Export Trading Company (U) Ltd 4.01% (2.95%) and Besmark Coffee Company Limited 3.58% (2.10%).
The top 10 exporters held a market share of 80% compared to 77% the previous month.
“There were changes in positions compared to last month reflecting competition at the exporter level,” the report says, adding: “Out of the 42 exporters that performed, 20 exported Robusta Coffee only while 5 exported Arabica coffee only.”
The destinations of Uganda’s coffee exports
Italy maintained the highest market share with 28.74% compared with 25.41% last month, the report says.
It was followed by Germany 15.11% (15.32%), India 12.58% (10.53%) Belgium 7.90% (9.74%) and Sudan 6.42% (10%).
Important to note is that the figures in brackets represent percentage market share held in March 2021.
“ Coffee exports to Africa amounted to 81,308 bags, a market share of 15% compared to 106,162 bags (19%) the previous month. African countries included Sudan, Morocco, Kenya, Algeria and Egypt. Europe remained the main destination for Uganda’s coffees with a 61% imports share,” the report says.
Global Situation
World coffee exports amounted to 11.94 million bags in March 2021 compared with 11.66 million in March 2020.
“Exports for the first 6 months of coffee year 2020/21 (October 2020-March 2021) increased by 3.5% to 65.4 million bags from 63.2 million bags the previous period (October 2019-March 2020),” the report says.
It adds that the ICO Composite Indicator price increased by 1.4% to 122.03 US compared to 120.36 US cents in March 2021.
The report says the prices have seen a positive trend since October as the imbalance between production and consumption is becoming smaller. Arabica supplies are expected to tighten as Brazil’s production is projected to decline in its 2021/22 off year crop.
“Global coffee production for 2020/21 is estimated to increase by 0.5% to 169.63 million bags while the consumption is estimated to increase by 1.3% to 166.35 million bags, as consumption that had been affected by the pandemic in 2019/20 is regaining its normal trend as more countries take on vaccination and ease lockdowns,” the report indicates.
Local Situation
The UCDA report indicates that during the month of April 2021, farm gate prices ranged from Sh.2,000-2,500/= per kilo of Kiboko (Robusta dry cherries); Shs. 4,100-4,500/= for FAQ; Sh. 5,400-6,000/= for Arabica parchment; and Sh. 5,000-5,500/= per kilo for Drugar from Kasese.
Robusta Kiboko averaged UGX 2,250/= per kilo; FAQ UGX 4,300/= per kilo, Arabica parchment UGX 5,700/= per kilo and Drugar UGX 5,250/= per kilo.
Outlook for May 2021
UCDA says coffee exports are projected to be 540,000 bags as the main harvesting period in Greater Masaka and South Western regions is on.
“Increased exports would be fuelled by increasing global coffee prices which will interest exporters to continue releasing their stocks as in the previous month. Coffee harvesting and drying might be hampered by rain in the countryside,” the report says.
