Tanzania’s robusta coffee yesterday fetched high prices at Moshi auction after reports over the production cut in Brazil following consistent dry weather since last month.
In a telephone interview with the ‘Daily News’ from Moshi, the Tanzania Coffee Board (TCB) Director General, Mr Adolph Kumburu, said the prices jumped to 172.3 US cents per pound compared to 138 US cents.
Prices of its Arabica normally track the New York market while those of robusta take their cue from London. “After the trading session, we noticed prices for robusta going up, due to reports that spread since early February that output in Brazil will drop,” he said.
Brazil is the world’s largest producer of Arabica coffee beans, accounting for about a third of global coffee production of about 130 million bags per year.
Mr Kumburu added: “If the situation in Brazil persists, it means Tanzania coffee prices will continue ticking up, with reflection on the increased income for the government, exporters and farmers.”
He said there has been continued improvement in the quality of coffee supplied to the auction and this has been reflected in its competitiveness in the world market.
He said further: “Our coffee is very competitive and has never failed to secure market in the world.” Increasing output has remained to be one of the challenges that have been facing domestic coffee production.
The average production is 1 million bags annually, thus bringing little impact in the global output. Estimates from commodities analysts over coffee output in Brazil ranged as high as 60 million bags of coffee for this year’s harvest, though Brazil’s government crop unit Conab forecasted a crop of 46.5 to 50.2 million bags.
It maintained that coffee supply tightening will not be seen until at least the 2015/2016 marketing year, barring any significant drop in Central American coffee production due to leaf rust disease.
Tanzanian coffee belongs to the Colombian group. Tanzania, Africa’s fourth-largest coffee producer after Ethiopia, Uganda and Ivory Coast, produces mainly Arabica and some robusta coffee.