Value of coffee sold at Kenyan auction rises 37 pct in 2013/14

Coffee beans are seen at a Nairobi Java House outlet in Nairobi January 21, 2012. REUTERS/Noor Khamis

NAIROBI (Reuters) - The value of coffee sold at Kenya’s auction climbed 37 percent to $174.1 million in the year to September, helped by higher global prices and better quality crops, the head of the Nairobi Coffee Exchange (NCE) said on Wednesday. The east African nation, whose high-quality beans are sought by roasters to blend with beans from other producers, exports much of its coffee through the exchange and the rest sold by growers to foreign buyers. Uncertainty over the performance of the crop in leading producer Brazil following a prolonged drought has helped prop up global prices of the commodity, said Daniel Mbithi, the chief executive of the NCE. Brazil grows about 40 percent of the world's arabica bean, which is the backbone of most commercial coffee blends. "We also had relatively good quality crop in the market and that helped strengthen prices,” Mbithi said. Officials at the NCE said 671,438 60-kg bags were sold in the 2013/14 season that runs October to September compared to 625,185 the previous year. The average price at the exchange climbed to $212.70 per 50-kg bag from $166.70 the previous year. East African coffee is normally packed in 60-kg bags, but the prices are quoted for quantities of 50 kg. Kenya had forecast in February that it expected coffee export earnings to dip this season, but the drought in Brazil later provided unexpected support for prices. Kenya earned about 18.5 billion shillings from exports of the commodity in 2012/13, including both auction and direct sales, down from 27.1 billion a year before. Coffee exports were once Kenya's leading foreign exchange earner but output has slipped from the record 130,000 tonnes produced in 1987/88. Many small farmers, disillusioned with poor earnings, switched to other crops or sold land for real estate. (1 US dollar = 89.2500 Kenyan shilling) (Editing by James Macharia)

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