Rwanda is looking to double its volumes of roasted coffee exports to mitigate against volatility in international prices that have hit revenues from the export of raw beans.
Coffee is one of the country’s major exports, with receipts growing at an average of 30 per cent per year between 2002 and 2010 but revenues have recently been unpredictable.
Rwanda sold 12 million kilogrammes of coffee during the first nine months of 2016, a 4.5 per cent reduction compared with the same period for 2015, according to statistics from the National Agricultural Exportation Board (NAEB).
The country is targeting Rwf54 billion from coffee for fiscal year 2016/2017, but the sector has to contend with fluctuating prices for raw coffee exports.
Revenues realised in 2016 fell to Rwf30 billion from Rwf33 billion collected in 2015, a result blamed on bad prices for washed raw beans.
Rwanda is now looking to its coffee roasting companies to overcome this challenge by consistently producing high volumes of roasted coffee beans to make up for the shortfall.
On the local Rwandan market, the price of one kilogramme of green coffee fetches a farmer only Rwf300, while a kilogramme of roasted coffee fetches up to Rwf4,000, market players say.
The price for roasted coffee tends to multiply when sold on the international market, according to Eric Rukwaya, marketing manager of Rwanda Farmers Coffee Company.
Rwanda Farmers Coffee Company was inaugurated in March last year, with modern coffee roasting machinery that has the capacity to produce 3,000 kilogrammes of roasted coffee per day.
“We currently produce at 10 per cent below capacity but realise our potential to boost Rwanda’s coffee exports significantly. We are targeting to provide high quality coffee products to our own market so as to help the country reduce the trade deficit,” Mr Rukwaya said.
“More companies need to add value to their coffee and sell on the local market,” he added.
Rwanda exported 95 per cent of the coffee it produced in 2015, but imported coffee worth Rwf1.5 billion, according to NAEB.
Currently, there are 15 coffee roasting companies in Rwanda, but they do not have the capacity to produce enough. Only 0.04 per cent (about 4,840kg) coffee produced between January and September was roasted.
NAEB also acknowledged that the biggest challenge in the coffee value chains is low productivity in terms of the yield of cherries per tree.
“The average yield per tree in Rwanda is estimated at 2.6 kilogrammes per tree per year. This could be explained by a lack or low usage of fertiliser, both mineral and organic, insufficient agronomic practices and pest controls,” Pie Ntwari, head of communications at NAEB said.
Rwanda’s five-year plan aims at increasing coffee exports by 29 per cent annually, and generating more than Rwf84 billion by 2018, almost doubling the current earnings.
Most of Rwanda’s coffee is exported to countries like Switzerland, Belgium, the UK, while 19 per cent is exported to the US.
Uganda, Kenya and Asia are the other major consumers of Rwanda’s coffee.