By Nelson Mandela Muhoozi
The London International Financial Futures and Options Exchange (Liffe) reported a notable increase in Robusta coffee prices on Monday.
The September position closed at $4,581 per tonne, up $51 from the previous closing, while the November position closed at $4,407 per tonne, marking a $52 gain.
Similarly, the Intercontinental Exchange (ICE) reported a rise in Arabica coffee prices across the board. The September position closed at $243.05 cents per pound, up $4.85 cents, and the December position closed at $241.30 cents per pound, an increase of $4.60 cents from the previous closing.
The increase in coffee prices comes amid mixed market signals from Brazil, the world’s largest coffee producer. Safras & Mercadoa, a major agribusiness consultancy, reported that Brazil’s 2024/25 coffee harvest was 74% complete as of July 16, compared to 66% at the same time last year and ahead of the 5-year average of 70%.
Despite the faster harvest pace, the consultancy cut its 2024/25 coffee output estimate to 66 million bags from a previous estimate of 70.4 million bags, citing drought conditions that have compromised yields.
Additionally, a rebound in ICE coffee inventories has exerted downward pressure on prices. ICE-monitored Robusta coffee inventories reached a one-year high of 6,128 lots on Friday, up from a record low of 1,958 lots posted in February 2024.
According to Uganda Coffee Development Authority (UCDA), the country robust sales for Robusta coffee, with Screens 18, 15, and 12 selling the highest volumes of 60-kilo bags at 4,720, 14,752, and 5,234 respectively, according to the daily coffee market analysis report for July 23, 2024.
According to the June market report, a total of 667,037 60-kilo bags of coffee valued at $162.36 million were exported in June 2024 at an average price of $4.06/kilo, $ cents 35 higher than $3.27/Kilo in May 2024, and $1.38 higher than $2.68/kilo in June 2023.
This was an increase of 18.24% and 79.14% in quantity and value respectively compared to the same month last year.
Farm-gate prices for Robusta Kiboko averaged sh5,650 per kilo; FAQ (Fair Average Quality) sh12,250 per kilo, Arabica parchment sh12,750 per kilo and Drugar sh11,500 per kilo.
Coffee exports for twelve months (Financial year 2023/24) totaled 6.13 million bags worth $1.14 billion compared to 5.76 million bags worth $846.02 million in the previous year (Financial year 2022/23).
This represents an increase of 6.33% and 35.29% in quantity and value respectively. About 67% of the total volume was exported by 10 exporters, out of 61 companies which performed during the month compared to 72% in May 2024. Sustainable Arabica fetched the highest price at $5.30 per kilo.
According to the Directorate of Strategy and Business Development, UCDA, world coffee production for 2024/25 is forecast to rebound 7.1 million bags from the previous year to 176.2 million due primarily to continued recovery in Brazil and rebounding output in Indonesia.
With additional supplies, global exports are expected up 3.6 million bags to 123.1 million primarily on strong shipments from Indonesia and Brazil according to Intercontinental coffee exchanges.
Ending stocks are also expected to rise by 1.9 million bags to 25.8 million following 3 years of decline according to the United States Department of Agriculture, Coffee: World Markets and Trade report-for June 2024.
Outlook for July 2024
According to UCDA, coffee exports are projected to be 650,000 60-kilobags. Meanwhile, the Authority said, harvesting of the main crop south of the equator (Masaka and Southwestern regions) has peaked.
Today’s coffee market prices in $ cents per Lb(pound)
Screen 18- 224.13
Robusta – Screen 15- 219.13
Robusta – Screen 12 – 216.13
Arabica – Bugisu AA 238.05
Arabica – Bugisu A 237.05
Arabica – Bugisu PB 235.05
Arabica – Bugisu B 235.05
Arabica – Wugar 236.05
Arabica – Drugar 217.05
Note: Price (sh/kilo), Exchange rate (1$=Sh3,689)
Coffee farmgate price range in sh/kilo
| Category of coffee | FAQ (Fair Average Quality) | Kiboko | Arabica parchment | Drugar coffee (clean) |
| Price Range | 12,000-13,000 | 5,500-6,000 | 13,000-13,500 | 11,500-12,000 |
