By Nelson Mandela Muhoozi
The global coffee futures market experienced mixed trends on Monday, with Robusta prices on the London International Financial Futures and Options Exchange (LIFFE) declining slightly, while Arabica coffee on the International Commodity Exchange (ICE) suffered sharp losses.
However, Uganda’s domestic coffee market demonstrated resilience, maintaining stable prices despite fluctuations in international markets.
Following the Tet Lunar New Year celebrations, Vietnamese producers resumed regular trading, influencing Robusta prices.
The March position on LIFFE closed at $5,653 (approximately sh21,206,790) per ton, shedding $18 (sh67,560) from the previous session.
Similarly, the May position closed at $5,663 (sh21,244,770) per ton, marking a $34 (sh127,740) decline.
Meanwhile, Arabica coffee saw a significant drop due to long liquidation pressure. The March position closed at 413.45 US cents (sh15,376) per pound, losing 15.60 US cents (sh580).
May ended at 404.40 US cents (sh15,048) per pound, down 16.70 US cents (sh621) from the previous closing.
Local market stability
Despite the global downturn, Uganda’s coffee prices held steady, according to data from the Uganda Coffee Development Authority (UCDA).
The prices for different grades of Robusta coffee stood as follows:
Robusta Screen 18: sh22,081 per kilogram
Robusta Screen 15: sh21,676 per kilogram
Robusta Screen 12: sh21,433 per kilogram
Arabica coffee prices also remained stable:
Arabica Bugisu AA: sh33,065 per kilogram
Arabica Bugisu A: sh32,984 per kilogram
Farmgate prices show consistency
UCDA further reported that farmgate prices for both Robusta and Arabica remained stable across various categories:
FAQ (Fair Average Quality) Robusta: sh14,000 – 15,000 per kilogram
Kiboko (unprocessed Robusta): sh7,500 – 8,000 per kilogram
Arabica Parchment: sh13,000 – 14,000 per kilogram
Drugar (Dry Uganda Arabica): sh12,000 – 13,000 per kilogram
Market outlook, expert insights
Dr. Michael Mugabira, a seasoned coffee sector expert and farmer, remains optimistic about Uganda’s coffee prospects.
He emphasized that quality harvesting practices, particularly picking only ripe coffee beans, are crucial for market competitiveness.
“Commodity prices are always subject to market speculation. The futures market operates on two-year purchase contracts, meaning that my coffee as a Ugandan farmer today is already booked. These price fluctuations are influenced by market speculators creating artificial panic. However, the overall price trajectory remains positive,” he explained.
Dr. Mugabira further highlighted Brazil’s projected production of 51 million bags this year, a significant drop from the estimated 70 million bags. Given the increasing global coffee demand alongside supply constraints, he believes Uganda is well-positioned to capitalize on the market gap.
“With our God-given excellent weather, Uganda has a very good opportunity to ramp up production and capture markets that major producers struggle to supply,” he said.
While global coffee prices experienced volatility, Bernard Sabiti of Besmark Coffee Company said yesterday that the market trend is encouraging farmers to grow more coffee.
He said, “By the way coffee went up sharply yesterday and that means Ugandan coffee farmers are benefiting from that price. More Ugandans will end up growing more coffee.”
Both experts agreed that Uganda’s local market remained stable, showcasing the resilience of the country’s coffee sector.
With increasing global demand and potential supply shortages from major coffee producers, they said Uganda stands a strong chance of expanding its market share, provided farmers maintain high-quality standards and enhance production capacity.
Uganda’s coffee export value
A total of 413,079 60-kilogramme bags of coffee valued at $115.03 million were exported in December 2024 at an average price of $4.64/kilo, US cents 11 higher than $4.53/Kilo in November 2024, and $ 1.90 higher than $2.74/kilo in December 2023.
This was an increase of 2.77 and 74.25% in quantity and value respectively compared to the same month last year.
