Despite a steady increase in coffee consumption around the world, trade prices have fallen dramatically in the past three years, hitting producers.

At the same time, the cost of an espresso or latte remains as full-fat as ever. What's going on?

Futures on arabica and robusta, the most widespread varieties of coffee, have fallen 40 percent since the beginning of 2017 and are now at historically low levels.

This is largely because of bumper harvests in Brazil, the world's main coffee producer.

But at the same time, consumption has grown by an average of 2.1 percent a year for the past decade, according to the International Coffee Organization (ICO).

Two billion cups of coffee are drunk every day, according to Fairtrade International, which works to improve the lot of farmers through better pricing and conditions.

"The consequences are terrible - they can no longer support themselves, invest in production or prepare for the challenges of climate change," she said.

Supplier woes

In Central and South America, many smaller producers in Africa and Latin America are giving up in particular those who grow arabica, which is more difficult to produce than the robusta variety favoured in Asia, according to Jack Scoville, a futures markets analyst with Price Group.

A similar trend is observable in Africa for reasons ranging from high production costs in Kenya to insecurity in significant producers like Cameroon.

Few growers have the money to invest, and access to the kind of fertile land they would need to switch to mechanised processes with economies of scale is limited.

As a result, "origins with a higher cost of production such as Colombia, Honduras and Guatemala are forecast to produce less coffee for the 19/20 season", said Geordie Wilkes, head of research at Sucden Financial.

ICO figures published last week illustrate the trend: South America will see production fall 3.2 percent in the coming season, compared with 0.9 percent worldwide.

At the same time, "demand for high quality is very strong", which protects prices for certain varieties and in certain regions, said Carlos Mera, analyst at Rabobank.

Max Havelaar France guarantees its producers a minimum price of $3.10 per kilogramme of coffee, plus a bonus if the coffee is organic.

Price fixing

But fairtrade represents only a small section of the market, and the vast majority of producers are vulnerable to prices fixed by traders in London or New York.

However, the low prices they set "do not affect consumer prices", said Paul Belchi, also from Max Havelaar France.

This is because the supply chain is long, running from the plateaus of South America to trendy coffee shops in the world's big cities.

When you take into account merchants such as giants Nestle and Lavazza, transportation, real estate prices and staff, the trade price of coffee is only about 10 percent of what you pay at the counter.

Rarer varieties like Jamaica Blue Mountain, Tarrazu Costa Rica or Bourbon Pointu from Reunion have prices more akin to caviar, negotiated directly between the producer and the merchants.

Some of these varieties change hands at more than $110 per kilogramme, compared with less than $2.20 that arabica fetched Friday November 8 on New York's ICE Futures US.
For consumers, Bourbon Pointu is currently selling online for $54 for 125 grams; $432 per kilogramme to be sure.

In an October 28 letter to the used car dealers’ association chairman, Syan Sajjad Pervaiz, the URA Commissioner for Customs Dickson Kateshumbwa said bonds that stay with the cars will not be licensed to operate next year.
Mr Syan, who heads the Syan Cars Limited in Nakawa confirmed to this reporter that they received the letter and said they would "try their best" to sell the cars by the end of December. He said the deadline was the end of October but URA granted them a two months extension to sell the cars.

Uganda announced a ban on the importation of cars that are 14 years and more effective October 2018 for environmental reasons.

READ:Government to lose Shs30b as ban on old cars effected

However, some dealers had hundreds of cars that were either on the way or already in the bonds. The cars were allowed to get in and traders were given a year to sell them.

A year later, some still have the cars aged 15years and more in their bonds. The new directive could see car prices dip a little bit so that dealers can meet the deadline. Traders will also expect the festive season to help them sell more cars.
It is not clear how many cars aged 15 years and above are held up in bonds in Uganda.

Nb

This is an African country that is very poor and it has no mass public transport of any sort that is modern and better for the environment.

The companies are Sheer Care Cleaning Services (U) Ltd, Frempa Cleaning Services, Dream Solutions Ltd, Kyambadde Abas Enterprises, Shadil Enterprises and General Techniques and Engineering Ltd.

This is the first time Nema is issuing operational licences to companies to collect and transport waste from sewers to the faecal treatment plant. Previously, companies were operating informally. The one-year renewable contracts were signed on September 10, by Dr Tom Okurut, Nema’s chairman of technical committee on the licensing of pollution, who is also the executive director.

According to the contracts, copies of which Daily Monitor has seen, the selected companies shall only use approved vehicles which must be in good condition with containers designed and maintained to contain hazardous waste. This is aimed at controlling littering, spillage, discharge or the emission of noxious smells from the waste.

The waste must only be transported to a waste management facility that is authorised or licensed by Nema to handle hazardous waste.
Kampala City has only two waste treatment plants and these are in Bugolobi and Lubigi.
The contracts further state that in case a discharge or spill of hazardous waste occurs during transportation, the transporter shall immediately take appropriate action to protect human health and environment.

However, Nema can revoke the licence of any company in case any of the terms and conditions is breached.
The Nema’s spokesperson, Ms Naome Karekaho, yesterday said the approved companies met the requirements. The requirements, among others, include having vehicles which are fitted with equipment to carry and discharge waste to the treatment plant.
She further noted that the licensed companies are audited to ascertain whether the waste they pick from the source tallies with what is discharged at the treatment plant.

“Before a company is licensed, we first evaluate its capacity in terms of the equipment it has to execute the job. We don’t want instances where hazardous waste is discharged everywhere. That’s why we are so strict when it comes to licensing,” she said.
However, she did not offer details of companies whose applications were rejected for lack of requisite standards.

Any company seeking to join the sewage business first applies to the association of Uganda Emptiers, which then recommends it to the National Water and Sewerage Corporation (NWSC), which is responsible for the faecal treatment plants.
NWSC approves the company before recommending it to the Kampala Capital City Authority (KCCA) administrator. KCCA first sends a team of inspectors to evaluate the capacity of the applicant before they recommend to Nema as the overall environmental watchdog, which then issues licences.

The director of Sheer Care Cleaning Services (U) Ltd, Mr Shaka Bakabulindi, welcomed the regulation, saying the licences are key in improving sanitation in the city.
However, he decried the shortage of parking space at the treatment plant.
“When trucks park at the treatment plant, it helps authorities to monitor the discharge of waste but apparently, the space is not enough and this means that some companies could collect waste from anywhere due to limited supervision,” he said.

Mr Bakabulindi also said emptying companies still lack financing to enable them effectively execute the job, imploring financial institutions to support them by offering them loans.
He further noted that the working hours at the treatment plants are limited, which makes it hard for them to cover all communities on time.
“For instance, treatment plants open from 8am to 6pm during weekdays and from 9am to 4pm during weekend. This timeframe makes it hard to deposit more faecal sludge yet the demand from communities is so high,” he said. 

Kampala is currently grappling with poor sanitation, especially open defecation and poor management of faecal sludge which at times ends up in drainage channels.
Statistics from KCCA show that 64 per cent of the population uses pit-latrines, 38 per cent use unlined pit-latrines, 29 per cent use septic tanks, and 1 per cent does open defecation, while only 8 per cent of the city population is connected to the sewer line.

To tackle the sanitation challenge in Kampala, KCCA this year rolled out the City Wide Inclusive Sanitation (CWIS) programme to sensitise communities about management and collection of faecal sludge. The CWIS is a three-year programme which officially kicked off this year. It seeks to achieve universal access to adequate and sustainable sanitation and hygiene for all and to end open defecation in the city.
The programme manager of CWIS, Mr Allan Nkurunziza, said one of the major aspects of the programme is to look at the source which generates the waste by implementing standards to ensure better emptying and transportation.

“For instance, there is a very huge day population in Kampala and we are looking at how to handle this crisis to offer toilet services. We are also looking at inclusiveness where women, children, the elderly and disabled and other minority groups such as refugees can access sanitation in the city,” he said.
Mr Nkurunziza also said KCCA will be working with partners involved in the faecal sludge management by looking at the regulatory framework.
For instance, he said while the fees for collection of faecal sludge might be affordable, the interests of both communities and the city authorities have to be protected.

In 2014, KCCA carried out a feasibility study on how to improve sanitation in Kampala as part of the transformative approach to change the health status of the city. The study attributed poor management of faecal sludge to long distance of up to 10km to one centralised faecal sludge treatment plant, unregulated service provision, lack of proper access to sanitation facilities and lack of emptying awareness.

Mr Bakabulindi said emptying charges range between Shs60,000 and Shs70,000 for a 2000-litre truck while at the treatment plant, a 2000-litre truck is charged Shs10,000 and a 4,000-litre truck is charged Shs15,000.
Any truck which carries more than 5,000 litres of faecal sludge, Mr Shaka said, is charged Shs20,000.

Treatment plants
National Water and Sewerage Corporation’s Sewerage Services Department (SSD) is responsible for operation and maintenance of the sewerage network, treatment plants, making new sewer connections and extensions in Kampala. The SSD operates two sewage treatment plants (STP) in Bugolobi and Lubigi.

The Lubigi STP has a combined capacity to treat 5,400m3 (5.4 million) wastewater a day. It receives and treats wastewater from the piped network as well as faecal sludge that is brought by private cesspool emptier trucks. The Lubigi catchment area consists of Makerere, Katanga, parts of Mulago, Kalerwe, Bwaise and areas along the northern by-pass.
The Bugolobi STP has a capacity to treat 33,000m3 of wastewater a day and receives piped sewage mainly from the central business district extending to parts of Old Kampala, Mengo, Katwe, Nsambya, Kibuli, Mbuya, Nakawa, Naguru, Bukoto and Kamwokya.

angwomoya@ug.nationmedia.com