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Arabica coffee prices drop

As the harvest season for Arabica coffee drawers nearer, the severe drop in prices of coffee parchment is drawing concern from farmers in Bugisu and Sebei subregions.

Prices of parchment have kept a steady decline to sh3,000 per kg of premium parchment from sh4,800 in February and sh5,000 in January.

Ordinary parchment is trading at sh2,000 and sh2,400 per kg, depending on the quality, down from sh3,400 and sh3,600 per kg early this year.

John Nakiwuza, 48, a commercial Arabica coffee farmer in Bukiise subcounty, Bulambuli district, explained that the drop has dampened the excitement that had come with the expected bumper coffee harvest this season.

“Some farmers have already started harvesting the fry crop (new coffee cherries) but the prices are disheartening. Arabica coffee requires proper care to reap good yields. This includes activities such as mulching, weeding, pruning, spraying and application of fertilisers. For the price to reduce to sh3,000 per kg is a mockery of our efforts,” Nakiwuza said recently.

“On average, a 50kg bag of fertiliser costs sh100,000. You need six bags to cover an acre of Arabica coffee trees. I have invested over sh2m to purchase fertilisers alone for my 12-acre coffee plantation but I’m not certain I will recover this money with the price drop,” Nakiwuza added.

Prices of premium parchment leaped to sh12,000 per kg in 2011, the highest for the cash crop in the last 15 years. The price, however, started a gradual slide — dropping to sh8,000 the subsequent year. As farmers and middle men hoarded stock basing on speculation that the prices may rise in a near future, their hopes were further dashed when prices dropped to sh7000 and steadily kept going down.

James Banya, a coffee farmer in Wanale sub-county, Mbale district said the drop in price will discourage farmers.

“Coffee is the most profitable cash crop for farmers here. If we are getting low returns, then there’s no need to dedicate huge acreage of land for its growth. We have families to take care of. The drop in prices will make it hard to meet our daily expenses,” Banya said.

Geoffrey Mwonge, an administrator with Kyagalanyi Coffee, a coffee export firm, said with the drop in prices is likely to impact on the quality of parchment this season.

“Arabica coffee farmers are hit hardest whenever prices drop. And what usually happens is that most of them neglect their coffee plantations. This lowers the grade of parchment supplied,” Muwonge explained.

From: New Vision