Prices of Kenyan coffee slid at Tuesdays auction as quality continued to slip and as a major buyer stayed away from the sale, the Nairobi Coffee Exchange (NCE) said. The average price for all grades fell $15 to $154.24 per 50-kg bag from $169.76 per 50-kg bag at last Tuesdays sale.
"Things were not good. The quality has come down and the international market is also down," Daniel Mbithi, an official at the NCE, said. Prices of Kenyan beans normally take their cue from the international market in New York.
Arabica coffee for May delivery was down 0.05 cent at $1.0625 per lb (0.4536 kg) by 1316 GMT at the New York sale. Mbithi said the absence of a big exporter made things worse for sellers. The buyer, Louis Dreyfus, stocked up on a lot of coffee during the past few auctions, Mbithi said.
A total 33,117 60-kg bags were on sale and 10,570 of them sold for $1.98 million. Last week, 30,652 60-kg bags were offered and only 11,825 found buyers for a total $2.44 million. Louis Dreyfus took 5,400 of those bags, Mbithi said. Specialty beans, such as the best AA grade lots, fetched $335 per bag, which is considered a premium. Kenya attracts very high prices for its gourmet beans, although overall production is very low.
Tea Prices Fall: Kenyan tea prices fell at this weeks auction, pulled down by erratic demand and poor quality, with more than a fifth of the packages offered unsold, brokers said on Tuesday. "Good but irregular demand for the 108,213 packages (6.92 million kg) which eased as the sale progressed with some teas remaining unsold," a statement by the Mombasa-based Africa Tea Brokers said. Best BP1s were weaker at $3.35-$3.05 per kg compared with $3.50-$3.10 at last weeks auction.
Top PF1s fetched $2.80-$2.48 from $2.70-$2.52 last week. "Brighter BP1s met less interest declining by 5-20 US cents but a few improved lines were firm to 20 cents following quality," ATB said. Kenya expects the global slump to curb earnings from exports such as tea this year, slowing growth in the regions largest economy. Kenya is the worlds biggest exporter of black tea. Traders say lack of financing has pushed some major buyers to cut back on their take-up rate. Some that normally bought tea to cover seven weeks of exports were now buying only enough for four or five weeks, they say.
Tea output in January fell 14 percent to 25.5 million kg compared with 29.7 million kg in the year ago period due to unfavourable weather in some of the tea growing areas, according to the Tea Board of Kenya.
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