Zambia’s 2010 coffee output is forecast to fall to 1,250 tonnes from 1,643 tonnes the previous year due to farm closures caused by lack of affordable long-term finance, a senior industry official said on Tuesday.
Joseph Taguma, the general manager of the Zambia Coffee Growers Association (ZCGA), said the projected low output was mainly because of the closure of a key farm, which produces one-third of Zambia’s total coffee output.
Taguma said exports to key markets in Europe, the United States and Asia would also drop below last year’s 1,593 tonnes due to the winding up of the Kasama Coffee Company (KCC), placed under receivership by some commercial banks it owed some money.
“We are projecting an even lower export production for the 2010 season of around 1,200 tonnes,” Taguma told Reuters in an interview.
Taguma said Zambian farmers were negotiating to access a $5 million European Union (EU) export development credit line to help boost output in the southern African country where risk-averse commercial banks have reduced lending to farmers in the last few years.
The ZCGA data shows that Zambian coffee output peaked at 6,000 tonnes in 2004, but poor weather and lack of capital for growth in recent years has forced production to drop.
Coffee output declined below the initially projected 1,800 tonnes in 2009 from 1,887 tonnes in 2008 due to low production after some farmers abandoned coffee to grow other cash crops.
Taguma said despite the drop in output, Zambian farmers last year benefited from high international coffee prices which averaged $3,352.94 per tonne compared with $2,635.93 per tonne in 2008.
Zambia does not grow coffee on a large scale like Ethiopia and Kenya, but its coffee is sought by buyers in Japan, the United States and Europe. Its washed arabicas, including the premier Triple A brand coffee are mainly shipped to Japan.