Foreign Coffee Buyers Drive Kenyan Prices to Three-Year High

Updated on
  • Roasters, buyers from Norway, Denmark, Germany, U.S. in Kenya
  • Average price $280/50-kg bag at Nairobi auction this week

Coffee roasters and buyers flocking to Kenya in their annual pilgrimage for the pick of the crop have driven average prices for the beans to the highest level in three years.

The cost of a 50-kilogram (110-pound) bag of AA grade coffee fetched $679 at an auction on Tuesday, the most since $751 at a sale last year, according to data supplied by the Nairobi Coffee Exchange. The average price has risen 50 percent since the season began on Oct. 10. to $280 per bag -- the highest since February 2015.

“This is the time we have the best quality of the beans in the market,” Nairobi Coffee Exchange Chief Executive Officer Daniel Mbithi said in a phone interview.

While a tiny grower when compared to regional producers including Ethiopia and Uganda, Kenyan beans are highly sought after by companies including Starbucks Corp. and are often used in blends to improve coffee from other regions. The country grew 47,400 metric tons last year, compared with 459,000 tons by Ethiopia, Africa’s biggest producer, according to International Coffee Organization data.

January and February are the peak selling season for Kenyan beans. The East African nation had three of the world’s top 30 coffees ranked by Coffee Review, a California-based buying guide, with one of the country’s AA brands rated the best in Africa and fourth globally. Intense marketing by coffee directorate at Kenya’s Agriculture & Food Authority has attracted buyers from the U.S., Norway, Denmark, Germany and Australia.

“The quality is the best this time of year,” said Stephen Vick, a procurement and quality manager for African Coffee Roasters, a company that sources and processes beans for Danish retailer Coop Danmark A/S. “If I was a specialty buyer and could go to one country, I would choose Kenya.”

Africa’s third-biggest arabica-coffee grower may produce 48,000 tons in the season through September, according to the U.S. Department of Agriculture. The nation is targeting output of as much as 100,000 tons by 2020, below its peak production of 130,000 tons in the 1980s.

The main competition for Kenyan coffee are beans from Ethiopia, Colombia and Panama, Vick said.

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