Coffee ready for export
Uganda’s coffee exports in January 2022 amounted to 402,212 60-kilo bags worth US$61.98 million (Shs218bn), Uganda Coffee Development Authority (UCDA) monthly report for January 2022, says.
This comprised 315,265 bags of Robusta valued at US $40.07 million and 86,947 bags of Arabica valued at US$ 21.91 million, the report obtained by Business Focus, reads.
This was a decrease of 9.80% in quantity but an increase of 56.44% in value compared to the same month last year.
By comparing quantity of coffee exported by type in the same month of last Coffee Year (January 2021), although Robusta decreased by 20.76% in quantity, it increased by 22.62% in value, while Arabica exports increased by 80.84% and 215.67% in quantity and value respectively.
Coffee exports for the 12 months (February 2021-January 2022) amounted to 6,722,115 60-kilo bags worth US$ 741.03 million compared to 5,465,184 60-kilo bags valued at US$ 511.66 million the previous year (February 2020- January 2021). This represents 23.26% and 38.18% increase in both quantity and value respectively.
“The decrease in Robusta exports was mainly attributed to correction where two consecutive good harvests were associated with lower yields this year also characterized by a drought in some regions. This led to a shorter main harvest season in Central and Eastern regions as well as a short fly crop in Greater Masaka and South-Western regions,” the report reads in part.
It adds: “Shortage of containers and congestion at the Malaba boarder also affected exports. The Increase in Arabica coffee exports is due to an on-year cycle characteristic of Arabica coffee production. Shortage of shipping containers in Vietnam and weather related concerns in Brazil fueled increase in global prices.”
Coffee exports by type
According to the report, the average export price was US$ 2.57 per kilo, 23 cents higher than US$ 2.34 per kilo realized in December 2021. It was US$ 1.09 higher than in January 2021 (US $ 1.48/kilo). Robusta exports accounted for 78% of total exports, lower than 84% in December 2021. The average Robusta price was US$ 2.12 per kilo, 9 cents higher than the previous month. Washed Robusta fetched the highest price of US$ 2.57 per kilo, a premium of 30 cents over conventional Screen 18.
It was followed by Organic Robusta sold at an average price of US$ 2.32 per kilo. The share of Sustainable/washed coffee to total Robusta exports was
only 1.97%.
Arabica fetched an average price of US$ 4.20 per kilo, 25 cents higher than in December 2021.
The highest price was for Mt. Elgon AA, AB and C/PB sold at US$ 6 per kilo, and were followed by Mt. Elgon A+ sold at US$ 5.06 per kilo . Drugar was sold at US$ 3.94 per kilo, a discount of 76 cents from Bugisu AA. Drugar exports had a 33% of Arabica exports compared to 47% the previous month. The share of sustainable Arabica exports to total Arabica exports was 20%.
Coffee Exports By Destination
The report says that Italy maintained the highest market share with 30.03% compared with 37.11% last month. It was followed by Sudan 17.02% (5.99%), Germany 10.15% (17.38%) Belgium 6.34% (3.59%) and Spain 5.61% (4.62%).
Important to note is that the figures in brackets represent percentage market share held in December 2021.
Coffee exports to Africa amounted to 97,554 bags, a market share of 24% compared to 88,546 bags (16%) the previous month. African countries included Algeria, Sudan, Morocco, Egypt, South Africa, South Sudan and Kenya. Europe remained the main destination for Uganda’s coffees with a 58% imports share lower than 70% in December 2021.
Local Situation
During the month of January 2021, farm gate prices ranged from Sh.2,700-3,500/= per kilo of Kiboko (Robusta dry cherries); Shs. 6,500-7,500/= for FAQ; Sh. 11,000- 13,000/= for Arabica parchment; and Sh.,10,000-11,000/= per kilo for Drugar from Kasese. Robusta Kiboko averaged UGX 3,100/= per kilo; FAQ UGX 7,000/= per kilo, Arabica parchment UGX 12,000/= per kilo and Drugar UGX 10,500/= per kilo.
Outlook for February 2022
Coffee exports are projected to be 400,000 bags in February 2022. “The main harvesting period season in Central and Eastern has ended since it was shorter and exporters will have to release their stocks to fulfil contractual obligations,” the report says.
Global Situation
According to the report, world coffee exports for December 2021 totaled 12.12 million bags up by 8.9% from 11.12 million bags in December 2020. The ICO Composite Indicator price increased by 0.6% to 204.29 US cents up from 203.06 US cents in December 2021, the highest in ten years.
The prices have seen a positive trend since October 2020. Concerns of supply shortage due to adverse weather conditions in Brazil and supply disruption caused by shortage of containers in Vietnam continue to push prices higher. Certified stocks at the major exchanges of New York and London continued to decline in the month of January. The stocks declined by 16.2% and 5.4% in New York and London respectively.
“Global coffee production for 2020/21 coffee year is estimated to decrease by 0.1% to 168.88 million bags down from 169.02 million bags in Coffee Year 2019/20. Global consumption is estimated to increase by 2% % to 167.68 million bags in 2020/21 coffee year compared to 164.46 million bags in 2019/20 coffee year,” UCDA, quoting the ICO January 2022 report, says.
