MILAN – The Uganda Coffee Development Authority (UCDA) projects that prices will rise again towards the end of the year as the western nations recover from the Eurozone crisis.
“The price of Arabica coffee premium parchment will not increase to sh12,000 per kg as was the case in 2011. But we expect a gradual rise to sh5,000 onwards. This is likely to occur from November to December. The Eurozone crisis has greatly affected coffee exports,” Fred Ruzinda, the UCDA finance officer explained recently in an interview with AllAfrica.
“The Euro zone crisis affected the consumption of our coffee, which led to a drop in prices. But the market will rebound. The bigger challenge we have as a country is that much of the coffee that is produced locally is exported.
Only 5% of the coffee produced is consumed locally.
If we had high local consumption, the fluctuation of coffee prices at the international market would not affect us much,” Ruzinda said.
With the prevailing drought, UCDA expects coffee exports for July to fall by 3% to 300,000-60kg bags compared with the same period in 2012.
The drought and falling coffee prices has dealt a blow to the coffee farmers and created fears among purchasing firms that farmers are likely to neglect appropriate measures to ensure quality of parchment.
