Business
Arabica coffee prices increase
Publish Date: Feb 14, 2014
Arabica coffee prices increase
A farmer picks Arabica coffee beans. A kilogramme of Arabica now goes for sh4,200 from sh3,000
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By Daniel Edyegu

Prices of Arabica coffee parchment have rebounded to sh4,200 per kilogramme, up from sh3,000 after nearly six months of price stagnation.

The increment came at the right time, the back-to-school period, when most coffee farmers need to pay school fees for their children. Students and pupils reported back to school for the first term on February 3.

Joseph Sodo, a coffee farmer from Katongo parish, Kapchorwa district, explained that the rise had offered a lease of hope to the coffee business.

Sodo, who has a child in secondary school and two at primary level, last week sold off 32 bags to get fees for them.

“With the price increment, it means each 65-kg bag of premium Arabica coffee parchment rose to sh273,000 up from sh195,000. I got sh8.7m which enabled me to pay my children’s fees,” Sodo said.

“The huge gain I made from this increment, however, is the fact that I had 2,400kg of stocked parchment that I had purchased when prices were still low.”

Prices of Arabica coffee parchment in Bugisu region are mainly dependent on the price at the New York Stock Exchange (NYSE) where its green beans trade under the name Bugisu Arabica.

For over six months, Bugisu Arabica had been trading at $2.4 per kilogramme of green beans. The price, however, rose to $2.7 per kilogramme towards the close of January, prompting a rise in local prices.

Since prices of premium parchment peaked at sh11,000 per kilogramme in 2011, prices had kept a steady drop settling at sh3,000.

Godfrey Woniala, a coffee farmer from Sisiyi subcounty, Bulambuli district, explained that the increase would motivate farmers to put in more effort in tending their plantations during the coming season.

“We had lost hope. Coffee is so costly to maintain because it requires fertilisers, pruning, weeding and spraying before even the actual processing of red cherries into parchment. When prices are low, it doesn’t make business sense to invest more and reap less”.

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