Nairobi Coffee Exchange suspends operations due to coronavirus

Already impacted by low international prices and climatic hazards, coffee farmers in the country were notified on Tuesday 7 april that auctions organized by the Nairobi Coffee Exchange (NCE) had been suspended.

The suspension is due to the increasing spread of the Covid-19 epidemic in the country (172 people infected and 6 deaths recorded as of 8 April). The coffee market thus becomes the last Kenyan commercial victim of this pandemic, after the Mombasa tea auction at the end of March. The measure, ordered « as early as the end of last week by the Kenyan Ministry of Health, » according to Daniel Mbithi, the director general of the NCE, took effect in the middle of april 7, after the publication of a stock exchange press release, reports the business daily Business Daily. In any case, it is expected to have a major impact on the Kenyan coffee marketing chain, a high-end Arabica production of which 90% of the harvest (the equivalent of 790,000 60-kilo bags in 2017/2018, according to the International Coffee Council) is sold via the NCE’s electronic auctions.

This delicate situation could nevertheless be an opportunity to activate the aid mechanisms of the recent African Coffee Fund. Launched in Nairobi last November on the initiative of the Inter-African Coffee Organization (IACO), the International Coffee Organization (ICO) and the Centre for Agriculture and International Biosciences (CABI), the African Coffee Fund has, among other things, provided - within its overall indicative envelope of 500 million dollars - 100 million dollars for « improving demand, trade links and investment ». This is a supportive approach which, if successful, would send a strong signal to the Kenyan coffee sector. The bean crop employs nearly 700,000 farmers and is the third largest agricultural export from East Africa, after tea and horticultural products.

Coffee in Kenya: quality (arabica) more than quantity (5th largest producer in Africa)
Source: ICO Computer graphics:

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