Demand for Ugandan coffee in Italy, where espresso lovers abound, has helped increase the East African nation’s exports of the beans to the highest in at least 30 years.
In August, Uganda overtook Vietnam to become the second-largest supplier of coffee to Italy for the first time this year, behind Brazil. Total shipments jumped 21% to 6.5 million 60-kilogram bags in the year through September — Uganda’s highest in three decades — about a third of that going to Italy.
Italy and Germany, which together produced more than 60% of the European Union’s roasted coffee last year, have diversified their sources for the beans. With Brazil and Vietnam having had trouble exporting amid shipping disruptions, European buyers increased uptake from growers including Uganda and India.
“Uganda has been a surprise over the past couple of years, it’s a successful case of production, expansion and promotion,” said Carlos Mera, head of agricultural commodities markets analysis at Rabobank in London. Given supply chain problems in South America and southeast Asia, roasters have been buying a little more from elsewhere and have been more flexible in blending, according to Mera.
Better Beans
Uganda is Africa’s biggest coffee exporter and the continent’s second-largest producer of the beans after Ethiopia. President Yoweri Museveni’s administration has overseen the planting of millions of new trees in recent years as part of plans to increase annual output to 20 million bags by 2030.
“There was some government involvement and we’re seeing the results, production has been increasing quite significantly and it’s likely to continue to do so,” Mera said.
Ugandan authorities have attributed the success in Europe, Asia and the U.S. to improved quality of their beans, which is now the focus as new trees begin to produce. Last year, Nestle SA’s unit announced its program to produce and market coffee from Uganda’s mountainous Rwenzori region. Nespresso sells its limited-edition capsules in places including the U.S. and U.K.
“We are seeing more professionals into coffee farming,” said Tony Mugoya, executive director of lobby group Uganda Coffee Farmers Alliance. “We are seeing more capital investment in the sector.”
Source: Bloomberg
