Malawi’s coffee farmers are facing a tougher selling season after local coffee prices plunged by nearly 24 percent.
Primary processed coffee is now selling at between K14,000 and K16,000 per kilogramme, down from about K21,000 per kg last year.
The Coffee Association of Malawi (CAMAL) says the fall is largely linked to increased production in Brazil and Vietnam, two of the world’s biggest coffee producers.
CAMAL secretary general Kondwani Nanchukwa, however, said Malawi’s prices remain favourable compared to some neighbouring markets.
He pointed to Tanzania, where processed parchment Arabica coffee is fetching the equivalent of about K8,010 per kilogramme, almost half the current price in Malawi.
But for local farmers, the drop has still delivered a painful blow to earnings.
In Rumphi, Phoka Coffee Growers Cooperative development manager Rodney Mbowe said some buyers were offering as little as K15,000 per kg, despite farmers expecting prices to climb to K25,000 after last year’s peak of K21,000.
Despite the pressure, the cooperative is targeting 200 metric tonnes of coffee this season and says it is making progress in aggregating produce from its washing stations.
Usingini Upland Coffee out-growers national coordinator Dominic Joseph said the lower prices could have one unexpected upside, as reduced price differences may weaken the incentive for traders to smuggle coffee across Malawi’s borders.
The bigger concern, however, remains Malawi’s declining coffee production. Annual output has fallen to about 1,000 metric tonnes from as high as 7,000MT in recent years.
Government’s 15-year Malawi Coffee Strategy seeks to reverse the decline by developing a stronger coffee value chain capable of generating US$240 million annually by 2040.
