Market analysts attribute this week’s 18% increase in coffee prices at the Nairobi Coffee Exchange (NCE) to the registration of additional mills and the strong demand for clean beans offered for sale.
A market report by the NCE secretariat reveals that during this week’s Sale 27, registered coffee broking firms offered for sale 23,930 bags, compared to 20,281 traded in Sale 20 last week. Of these, 17,459 bags, or 73% of the total amount of coffee traded, were of the highest grades, AA and AB.
The total proceeds from the auction, according to the report, came to $7,295,208 (Sh970 million), a substantial rise over the $5,786,468.20 (Sh769.6 million) that was raised at the auction last week.
The price per bag went up from $232 (Sh30,856) to $248 (Sh32,128) on average, making up 6.9% of the total amount obtained last week. On the trading floor, this average price is equal to Sh100 per kilogram of cherry. According to Henry Kinyua, an expert in the coffee value chain, the auction has been. More coffee is being ground and distributed equally to those who are for sale, according to the catalogue. “The catalogue shows more mills have been licensed and are now operating, which eases the crushing of parchment coffee, and equally, quality has remained impressive,” explains Kinyua over the phone. He claimed that farmers’ morale has increased as a result of the Direct Settlement System (DSS) coffee payouts, and as a result, they are regularly putting their coffee on the market.
Coffee Price
Data from the NCE indicated that coffee farmers in the last five months of the 2024/25 crop year have received over Sh12 billion through the DSS that was developed by the Cooperative Bank of Kenya.
The data indicated that between Oct 1, 2024, and the end of February this year, the DSS system settled 17.2 million kg, accounting for 339,803 bags in total coffee volumes valued at $89.5 million.
On August 8, 2024, NCE announced the appointment of the Cooperative Bank of Kenya as the provider of DSS to coffee value chain players after every sale in the country.
In addition, the clearing and settlement of trades through the Co-op Bank’s Direct Settlement System (DSS) has ushered in unprecedented levels of price transparency that have greatly rebuilt the trust that farmers have in the coffee auction and the Nairobi Coffee Exchange.
NCE on August 8, 2024, announced the appointment of the Cooperative Bank of Kenya as the provider of DSS to coffee value chain players after every sale in the country.
The NCE secretariat confirmed that the highest price recorded from the sale reached $455 (Sh60,515) from the Kiamugumo factory of the New Ngariama Farmers Cooperative Society in Kirinyaga County. Other factories whose coffee costs more than $400 (Sh53,200) per bag include the KII Factory, Karimikui, Kerugoya, and Kabingra from Kirinyaga County. Others included Gichatha-ini, Gakundu, Kamwangi, and Kiunyu in Nyeri County. During the auction, a total of 847 bags, or 4 per cent of all bags traded, fetched more than $400 (Sh53,200) per bag.
In addition to being the highest average price of any broker, Kirinyaga Slopes Coffee broking successfully sold 8,343 bags at an average price of $292 (Sh38,836). Baringo KawaBrokinge Company, the latest entrant, also presented 247 bags for trading and received an average price of $206 (Sh27,398).
