Prices of Kenyan coffee eased at Tuesday's auction, amid dwindling supply of top quality beans as the main crop season draws to an end, traders said.
"The quality was the same as last week's although there is a bit of competition for the FAQ (fair average quality) because there is literally none of it left," one trader from a leading coffee export firm said.
The average price per 50-kg bag realised at the auction was sharply down at $65.33 compared with $71.36 last week. Traders said three newly licensed coffee marketers did not participate at the weekly auction.
The government, keen to revise a sharp decline in coffee production and quality, introduced coffee sector reforms in 2001 which include handing over coffee marketing to private players to increase competition.
So far only three marketing agents have been allowed to sell coffee at the Nairobi Coffee Exchange (NCE) and some farmers have been calling on the government to licence more marketers.
The Coffee Board of Kenya, the coffee industry regulator, said last week it would licence Large and Small Coffee Marketing, Allied Marketing Agencies and Mount Kenya East Coffee Marketing Agency to bring to six the total number of marketing agents allowed to operate at the auction.
"They will probably be in the market after the auction break in August. Farmers will probably start sending their crop to them now," the trader said.
An auction report by the NCE said 9,865 bags of the 12,464 60-kg bags on offer were sold.
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