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Kenya Coffee Prices Jump as Exporters Replenish Stocks

Kenyan coffee prices jumped 16 percent at an auction yesterday as exporters replenished their inventories amid reduced supplies ahead of the Christmas break, the Nairobi Coffee Exchange said.

The average price for all coffee sold climbed to $341.22 per bag, compared with $295.16 at the previous auction a fortnight earlier, the exchange said today in an e-mailed report from Nairobi, the capital.

The benchmark AA grade increased 3.3 percent to an average of $426.71 a bag, the agency said. Supplies of the grade fell by a single bag to 4,245 50-kilogram (110-pound) bags, it said.

“Buyers are scrambling for the coffee as we head into the festive season,” Kizito Keya, a coffee dealer at Mumba Coffee Ltd., said by phone from Nairobi. “We are remaining with one auction next week before we break off for the holidays.”

Sales rose 2.3 percent to 16,127 bags worth $6.71 million, the exchange said. Supplies at the fifth auction of the 2010-11 season fell 2.7 percent to 23,421 bags, it said.

The agency has been holding fortnightly sales instead of weekly auctions for more than two months because of low stocks.

Kenya’s coffee exports through the Nairobi Coffee Exchange, which handles the bulk of the shipments, fell 7.2 percent in 2009-10 to 36.197 tons after production declined, the agency said on Oct. 1. The country has yet to release an output forecast for this year, it said.

Kenya harvests the bulk of its crop from October through December, while a secondary crop is reaped from April to June. The following are details of today’s auction in U.S. dollars for a 50-kilogram bag:

Grade     Low       HighAverage
AA        250       604       426.71
AB        244       478       388.41
C         200       387       306.62
E         367       367       367.00
F1        232       232       232.00
HE        200       246       225.71
MH         38       170       150.67
ML         31       123        63.92
PB        232       481       373.22
SB         28        59        44.54
T          47       281       151.05
TT        156       456       324.21
UG        267       267       267.00
UG1       199       270       243.70
UG2        42       235       121.56

To contact the reporter on this story: Fred Ojambo in Kampala at fojambo@bloomberg.net.

To contact the editor responsible for this story: Paul Richardson at pmrichardson@bloomberg.net.

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