Ugandan Government Attributes Sharp Drop In Coffee Prices To Global Oversupply And Strong Harvests – CoffeeTalk

The Ugandan government has confirmed a sharp decline in coffee prices, attributed to a combination of global market forces beyond Uganda’s control. A market analysis report shows that current farm gate prices for key coffee types have significantly dropped, with Robusta (FAQ) selling between shs10,000-11,000 per kilogram, Kiboko (Kiboko) ranging from shs 5,000-5,500, Arabica (parchment) trading between shs 14,000-15,000. Drugar (clean) is at shs14,000.

Coffee is an internationally traded commodity and is highly susceptible to external shocks, including changes in weather, global production levels, and speculative trading. Improved weather conditions in key producing countries like Brazil and Vietnam have led to a reversal, as Brazil’s coffee output is expected to rise by 0.5% to 65 million bags in the 2025/26 season, while Vietnam’s production is projected to grow from 29 million to 31 million bags. This increased supply has created an oversaturated global market, especially for Robusta, resulting in downward pressure on prices.

The minister also emphasized the role of futures trading in international markets, with Arabica mainly traded on the Intercontinental Exchange (ICE) in New York and Robusta on the London International Financial Futures and Options Exchange (LIFFE). Global coffee production is forecast to hit a record 178.7 million bags, up by 4.3 million from the previous year. However, global exports are projected to rise by 700,000 bags to 122.3 million, and consumption is forecast to reach a record 169.4 million bags, not enough to offset the supply glut.

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