Coffee export earnings drop

UCDA is hopeful that farmers will reap more in 2020

Kampala, Uganda | ISAAC KHISA | Latest figures indicate that Uganda’s coffee export earnings dropped in 2018/19 season (October-September) but the regulator is optimistic that the industry performance will rebound in 2019/20 season.

Coffee, the country’s second largest commodity export behind tourism, recorded 4.43million – 60 kg bags in exports worth US$433.9milion in the 2018/19 season (Oct- Sep)   compared with 4.3million 60 kg bags worth US$462.8million exported in the previous season.

This represents a 3.12% increase in quantity and 6.24% drop in value during the period under review.

These figures are from the Uganda Coffee Development Authority (UCDA).

The UCDA Executive Director, Emmanuel Iyamulemye Niyibigira, told The Independent in an interview that the drop in earnings is attributed to a reduction in price for the commodity at the international market owed to surplus in production.

Globally, coffee prices fell from an average of US$2.47 per kilogram in 2017/18 season to US$2.23 per kilogram in the 2018/19 season, according to the International Coffee Organisation (ICO).

The world  coffee production in 2018/19 season is estimated to be 3.7% higher than in the previous year at 168.87 million bags, as output of Arabica increased by 1.8% to 102.68 million bags and Robusta grew 6.7% to 66.04 million bags.

The world coffee consumption is estimated to be 2.1% higher at 164.82 million bags, but coffee production exceeded this by 4.05 million bags, ICO data shows.

Surging exports

This is the third consecutive year that Uganda has recorded a surge in export volumes since 1996 when exports stood at 4.15million bags.

UCDA has since 2012 distributed more than 317,000 coffee seedlings to farmers across the 98 districts that grow the crop, though low productivity, unpredictable weather conditions, inadequate agricultural extension officers, and low use of fertilizers remains a big hindrance to productivity.

The replanting initiative received a major boost in 2013 when the government unveiled the Operation Wealth Creation aimed at raising household incomes for poverty eradication and sustainable wealth creation.  More than 1.7million of the country’s 35million people are involved in coffee growing countrywide.

The East African nation is eying at exporting more than at least 20 million bags a year by 2025.  It exports most of its coffee to the European Union, Sudan, USA, and India, with Robusta coffee accounting for 85% of the total exports.