- UNCTAD warns falling global coffee prices are hurting international trade and threatening Kenya’s coffee earnings.
- Lower prices could reduce incomes for farmers, cooperatives and exporters.
- Analysts urge greater coffee value addition to cushion the sector from price volatility.
Kenya’s coffee sector could face renewed pressure after the United Nations (UN) warned that declining global coffee prices have weakened international trade in coffee, raising concerns over export earnings and farmer incomes.
According to the latest UN Trade and Development (UNCTAD) Global Trade Update (July–August 2026), coffee was among the commodities that recorded weaker trade performance during the first quarter of the year as prices retreated from previous highs.
“Trade in coffee, tea, and spices declined sharply, largely due to lower coffee prices following previous highs,” the report states.
The findings come as Kenya continues to rely on premium Arabica coffee as one of its leading agricultural exports, with thousands of farmers depending on international markets for their livelihoods.
A prolonged decline in prices could reduce earnings throughout the coffee value chain, affecting growers, cooperatives, millers, exporters and the country’s foreign exchange revenues.
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The report notes that although global trade maintained an upward trajectory in early 2026, rising geopolitical tensions, changing trade policies and economic uncertainty continue to reshape international commerce.
“Global trade continued to expand in early 2026, but mounting geoeconomic tensions, shifting trade policies and persistent uncertainty are reshaping international commerce,” it adds.
The changing market environment has renewed calls for Kenya to strengthen value addition instead of relying heavily on exports of unprocessed coffee beans.
Industry analysts argue that expanding domestic processing, branding and exports of roasted and specialty coffee products could enable the country to capture greater value while reducing exposure to volatile global commodity prices.
Kenya has built its international reputation on high-quality Arabica coffee traded through the Nairobi Coffee Exchange (NCE) and specialty markets abroad. However, fluctuating global prices continue to expose producers to external market forces beyond their control, underscoring the need to diversify export strategies.
The UN report also highlights a widening gap between traditional commodity exports and emerging high-value sectors. While trade in technology products and digitally delivered services recorded notable growth during the first quarter of the year, several agricultural commodities, including coffee, registered weaker performance.
The trend presents a growing challenge for commodity-dependent economies such as Kenya, where agricultural exports remain a major source of income and foreign exchange.
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The report is expected to heighten discussions among policymakers and industry stakeholders, including the Coffee Directorate, the Nairobi Coffee Exchange, exporters and cooperative societies, on measures to cushion farmers against declining international prices while improving the sector’s competitiveness.
Analysts say investments in coffee roasting, instant coffee production, premium packaging, certification and direct access to international buyers could help Kenya earn more from its coffee exports while reducing dependence on fluctuating raw commodity markets.
Although UNCTAD does not forecast a prolonged downturn in global coffee markets, it warns that international trade continues to be shaped by changing prices, geopolitical developments and shifting demand.
“Trade patterns continue to evolve as changing prices, geopolitical tensions and shifting demand reshape global commerce,” the report concludes.
By Jonathan Mwinzi
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