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South African coffee farmers get sh7bn EU deal

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Monday, 25 July 2011

South African coffee farmers get sh7bn EU deal

Coffee farmers, under the Ankole Coffee Producers Co-operative Union, have secured a contract to supply over 1,000 tonnes of coffee to the European Union (EU) and South Africa. The development comes at a time when the country is faced with a shortfall in foreign exchange earnings as a result of dwindling export receipts.

John Nuwagaba, the union’s general manager, said farmers would fetch about sh7.2bn (€2.0bn) this season if they supply the required coffee. Nuwagaba identified the EU countries as Spain, Holland, UK and Germany. He, however, expressed fear that they might fail to raise the required quantities because farmers are not organised and due to a decrease in coffee acreages caused by the coffee wilt disease.

His concern is not far-fetched as issues of honouring and raising contractual quantities have always been a big asking for local exporters. This has, in turn, taken a huge toll on Uganda’s export earnings. The official said, besides being strict on quality, the interested countries want non-contaminated organic coffee.

Source: New Vision