Kenya 2010-2011 Coffee Output Seen Up 25%

NAIROBI, Mar 11, 2011 (Dow Jones Commodities News via Comtex) — Kenya’s coffee output is expected to rise to over 50,000 metric tons in crop year 2010-11 [October-September] from a record low 40,000 tons the previous year, Kenya Coffee Research Foundation Director Joseph Kimemia said Friday.

“If we get rain before the end of March, we expect a good harvest in the early crop [May-July],” Kimemia said.

Demand for a new higher-yield, disease-resistant variety is very high, as high global coffee prices mean farmers are taking coffee seriously after years of neglect.

Despite the weather department this week predicting a prolonged dry spell, this isn’t a worry because flowering for December harvest was very good, Kimemia said.

An official revised coffee output estimate for this year is expected before the end of the month, Kimemia said.

“Coffee farming is picking up, farmers are getting record payments. It is good business,” said Samuel Muriithi, a farmer in central Kenya’s Kirinyaga region.

In February, Kenya’s benchmark grade AA reached a record high $1,022 for a 50 kilogram bag at the weekly Nairobi auction.

Joshua Sitati, a farmer in the Mt. Elgon region near the Ugandan border, said the area has already been receiving some rain, which will boost bean ripening and quality.

Kenya exports near 98% of its coffee output mainly to the European Union, the U.S. and the Middle East.

Coffee production in Kenya has been in decline from a peak of 129,926 tons in 1987-88 to a low of 40,000 tons last year, largely due to poor earnings by farmers as result of mismanagement and corruption in farmers’ cooperatives.

Currently, the giant smallholder coffee farmers union, Kenya Planters Cooperative Union, is in receivership.

-By George Mwangi, contributing to Dow Jones Newswires; 254 735 781 853; email hidden; JavaScript is required