Reviewing Africa’s green coffee trends
Sorting coffee cherries in Tanzania. Image: Genuine Origin
Although there have been fluctuations, production in most of Africa’s key coffee-producing countries has remained relatively stable, even during the pandemic. Furthermore, there are numerous favourable factors such as a rising domestic coffee consumption rate, an increasing demand for Africa’s green coffee in key markets such as Europe, and strong nursery programmes to replenish old trees, all positioning the coffee-producing areas for growth. By Shem Oirere.
Global coffee production for 2019-2020 dipped 2.5 per cent to 168.84 million bags compared to the previous year, except for Africa where green coffee-producing countries posted an average modest growth of 0.5 per cent for the period, according to the International Coffee Organization (ICO).
Africa’s production of green coffee has been fluctuating in the last few years with new projections of a 0.3 percentage point decline from 19.33 million bags in 2020-21 to 19.27 million bags for the 2021-22 coffee year. The projections may be slightly above or below the actual output figures once the production figures across the continent are confirmed.
Previously, the ICO said production of both Arabica and Robusta in Africa increased by 7 per cent between 2017 and 2019, from 17,354 thousand 60-kg bags, an output that declined by 1 per cent between 2019 and 2020 from 18,686 thousand 60-kg bags to 18,514 thousand 60-kg bags.
On average, the decline in production between 2017 and 2020 among Africa’s coffee producers was 0.9 per cent, with the biggest individual drop for the 2019-20 period being notable in Burundi (-6.4 per cent), Cote d’Ivoire (-8 per cent), Kenya (-8.1 per cent) and Rwanda (-8.3 per cent) according to the May 2021 ICO statistics.
Favourable conditions for growth
Despite the slight dip in production for the 2019-20 period, a growing domestic coffee consumption rate, an increasing demand for Africa’s green coffee in key markets such as Europe, favourable weather conditions and elaborate coffee nursery programmes to replenish ageing farms, especially in Uganda and Ethiopia, could keep the continent’s green coffee output steady in the long term.
Demand for green coffee output in Africa is lately being driven by the surge in the continent’s consumption levels, currently estimated at 7 per cent of the total global intake. Coffee consumption has grown by 3.2 per cent since the 1990-1991 when 4.9 million bags were consumed to 11.67 million bags in the 2018-19. Nearly 70 per cent of this consumption is in Algeria, Ethiopia, South Africa, Morocco, and Egypt.
Elsewhere in the global market, consumption in 2019-20 period dropped by 0.9 per cent to 167.59 million bags, hence easing demand on green coffee supplies. The opposite is true of Africa for the same period where demand for green coffee was estimated at 12.02 million bags for the 2019-20 when domestic coffee consumption surpassed 11.67 million 60-kg bags with more than 70 per cent of it consumed in Ethiopia, Algeria, Morocco, South Africa, and Egypt.
Although the Covid-19 pandemic appeared to suppress consumption in markets such as Uganda due to prolonged lockdowns, Africa’s consumption is expected to grow by 2.4 percentage points to 11.7 million bags from 11.4 million bags in 2020-21 according to the ICO.
Moreover, demand for green coffee within the African market is expected to grow even further, driven by the expanding urban population, especially in sub-Saharan Africa (SSA). The World Bank estimates SSA’s urban population to have grown from 209 million people in the year 2000 to 469 million people in 2020—a 41 per cent increase. This urban population growth is linked to the increase in coffee consumption in the region and the subsequent demand for more green coffee, hence fuelling output.
Furthermore, there is continued demand for Africa’s green coffee in leading coffee-consuming markets such as EU-28 that could trigger the desire to ramp up production of green Arabica and Robusta coffee to meet requirements of international buyers. For example, the European Coffee Federation says between 2016 and 2018, Africa’s top green coffee producers including Uganda, Ethiopia, Kenya, Tanzania, Cote d’Ivoire, Cameroon, and Burundi sold 328,545 tonnes to the EU-28 market with Ethiopia and Uganda being the top suppliers.
Mixed results among top producers
Green coffee production among Africa’s top producers paints a picture of mixed performance for the period between 2017 and 2020 when Ethiopia and Uganda reported a modest increase in output while Cote d’Ivoire, Kenya, Democratic Republic of Congo (DRC), Tanzania and Guinea reported a decline, particularly between the 2019 and 2020 harvesting period.
Ethiopia, Africa’s largest green coffee producer and consumer of processed coffee, has enjoyed steady growth in production for three years to 2021 driven largely by the presence of suitable growing conditions with projection indicating the country’s output could reach 7.62 million bags during the 2021-22 year, with up to 55 per cent of the production expected to be consumed domestically according to USA’s Department of Agriculture (USDA).
Between 2019 and 2020, Ethiopia’s production grew 0.4 per cent lower than the 1.2 per cent to 7.55 million bags earlier projected by ICO. This modest growth in output coincided with the enactment by the Ethiopian government of a new marketing and export policy that allows direct coffee exports by smallholders with minimum of two hectares of land and by commercial farms to“encourage vertical integration and improve coffee traceability,” according to USDA.
Growth in coffee production was also reported in Uganda for the 2019-20 period when the landlocked country reported a 2 per cent increase in output to 5.62 million bags according to ICO statistics, up from the previously projected 1 per cent surge to 4.75 million bags. The output was expected to reach 6 million bags during the 2020-21 coffee year supported largely by the maturity of new coffee plantings under a state-sponsored plan for farmers to take old trees out of production via stumping according to projections by USDA.
“We have seen coffee production increase from 4.2 million 60-kg bags in 2015-16 to 8.06 million bags in 2020-21 while coffee exports have increased from 3.6 million 60-kg bags in 2015-16 to 6.1 million 60kg bags in 2020-21,” said Emmanuel Iyamulemye, managing director, Uganda Coffee Development Authority.
He said that this is mainly attributed to the planting of new coffee trees. “Cumulatively, 1.167 billion coffee seedlings were generated and distributed between 2015-16 and 2020-21.”
In Côte d’Ivoire, one of West Africa’s top Robusta coffee producers, known to be of medium quality, the output declined by 8 per cent between 2019 and 2020 to 1.8 million bags defying predictions by ICO of a 4.1 per cent dip in production that could have totalled 2 million bags. The country had reported a 41.6 per cent increase in output to 2.09 million bags in 2018-19.
Guinea, one of Africa’s smallest coffee producers, posted the biggest decline in output by 15.9 per cent between 2019 and 2020 from 178,000 bags of green coffee to 150,000 bags. However, green coffee production statistics for Guinea have remained inconsistent with one report saying the only consistency is “the fact that production volumes have been low.”
Some of Africa’s bigger green coffee producers including Kenya, and the Democratic Republic of Congo (DRC) also reported a decline in output of 8.1 per cent and 4 per cent respectively between 2019 and 2020.
This decline in output for Cote d’Ivoire, Kenya, DRC, Tanzania, and Guinea seem to have partially been compensated by the positive growth in production by Rwanda, Cameroon and Uganda at 6.3 per cent, 4.4 per cent and 2 per cent, respectively.
A bright future
Africa’s green coffee production and uptake, similar to many coffee markets globally, was impacted by the Covid-19 pandemic that the ICO says caused “unprecedented joint supply and demand shock to the global coffee sector.”
The Covid-19 pandemic not only triggered a competitive coffee price regime in the global market but also constrained supplies, especially in 2020 and 2021, due to pandemic containment measures, including cessation of all forms of transportation. In addition, the pandemic ushered in a new normal where unprecedented lockdowns led to a general increase in home coffee consumption as nearly all hotels, restaurants and catering services remained closed, and a huge portion of the working class was restricted to working from home.
According to 2019-20 ICO chairman Iman Pambagyo, “the pandemic aggravated issues such as the coffee price volatility, thus generating instability and uncertainty.”
The future of Africa’s green coffee production and trade looks bright especially with the ongoing coffee farm programmes such as the current stumping in Uganda and Ethiopia as well as the emerging demand-trigger trends such as the expanding middle-class segment of the population in Africa and the entrenched café and coffee shop culture in consuming markets that rely on Africa for coffee supply such as the Middle East and Europe.
- Shem Oirere is a freelance business journalist based in Nairobi, Kenya. He has spent more than 25 years covering various sectors of Africa’s economy including the region’s agribusiness. He holds BA in International Relations and Diplomacy from the University of South Africa and earned a higher degree in journalism from the London School of Journalism and is also a member of the Association of Business Executives (ABE).