Kenya's coffee exports earnings fall on low global prices

 NAIROBI, June 13 (Xinhua) 

The value of Kenya's coffee earnings in the first quarter of 2023 (Q1) dropped 20.2 percent amid a decline in export volumes and global prices, the Kenya National Bureau of Statistics (KNBS) said in an economic report released Tuesday.

The country earned 7.63 billion shillings (about 55 million U.S. dollars) from 11,284 metric tons (MT) of coffee, a decline from 69 million dollars from 11,923 MT in Q1 of 2022, KNBS said.

 It said the bulk of Kenya's coffee, 5,486 MT during the quarter, was exported in March and the lowest, 1,921 MT in January.

 Kenya mainly produces Arabica coffee, which is used to blend other varieties in the global market.

The coffee variety, which has a moderate sour taste, is the most traded globally, taking up to 70 percent of the market share, according to the International Coffee Organization (ICO).

On the other hand, there is robusta coffee, which has a deep flavor and contains high caffeine content. It, however, is less expensive.

During the period, the price of Arabica coffee continued to fall in the global market, trading at an average of 5 dollars per kilo despite demand remaining stable, down from 6.7 dollars in a similar period in 2022.

Besides falling global prices, Kenya's coffee production has also been on the decline over the years due to farmers switching to other crops like avocados and challenges brought about by climate change effects, including drought and diseases.

The area under coffee has declined from 170,000 hectares in the 1990s to less than 100,000 hectares while production has shrunk from more than 130,000 metric tons in the 1980s to about 35,000 metric tons.

Coffee, therefore, is no longer one of Kenya's top foreign exchange earners, with the crop losing its status to tea.

The government has, however, started a number of initiatives to lift the sector, including access to low-cost loans from a revolving fund worth 26.7 million dollars.