The state-run Tanzania Coffee Board (TCB) said 28,310 60-kg bags were offered at the latest sale, of which 24,291 bags were purchased.

At the previous sale 23,303 bags had been offered and 23,129 sold.

"The decline of arabica coffee prices in Tanzania last week is a direct reflection of the downward movement of prices in New York," said a trader at a coffee exporting company based in the northern Tanzanian town of Moshi.

"However, robusta coffee prices remain high due to the prevailing strong demand for the coffee beans."

Tanzania, Africa's fourth-largest coffee producer after Ethiopia, Uganda and Ivory Coast, produces mainly arabica and some robusta coffee. Prices of its arabica normally track the New York market, while those of robusta take their cue from London.

"Overall average prices at the Moshi exchange were down by $1.05 per 50 kg for mild arabica compared to the last auction," regulator TCB said in its report.

"Average prices were below the terminal market by $6.96 per 50 kg for mild arabica, while robusta was above the terminal market by $23.25 per 50 kg," it added.

Benchmark grade AA sold at $155.00-$172.00 per bag, compared with $156.00-$183.00 per bag previously.

The average price was $161.58 per bag, slightly up from $161.25 previously.

Grade A fetched $152.00-$169.00 per bag, compared with$156.20-$177.00 per bag at the previous sale.

The average price fell to $158.81 from $161.33 previously.

East African coffee is normally packed in 60-kg bags, but the prices are quoted for quantities of 50 kg.

The TCB has said it expects the 2012/13 (June/April) crop to rise to 55,000 tonnes from around 32,000 tonnes in the previous season.