Sudan is one of the biggest buyers of Uganda’s coffee and the country consistently ranks second behind the European Union as Uganda’s big export markets for coffee.
However, since Sudan’s anti-government protest broke out volumes of coffee exports from Uganda to Sudan have “dropped drastically” since June 2018, hurting many farmers and traders.
“Sudan is a big market for us, so technically no exporter in Uganda can say they are unaffected by what is happening there, except small traders who go in and sell small volumes quickly. But for the biggest exporters with big volumes, this is a problem,” said Suresh Iyer, the branch manager of Olam Uganda Ltd, one of the major coffee exporting companies.
Last December, mass protests against President Omar al-Bashir’s three-decade rule erupted in Khartoum over the country’s spiralling economic woes that have over the past year seen inflation rates spike to the third highest in the world.
Shortages of basic commodities such as bread — the most consumed food item — are reported to be critical, while petrol stations have also run out of fuel.
According to Industry sources the figures worsened in November last year when Uganda exported only 700 bags of coffee to Khartoum, though in December this figure slightly improved to 10,500 bags.
“Perhaps the figures will climb back this month, and they could double, but we cannot be sure,” said Laura Walusimbi, the spokesperson of Uganda Coffee Development Authority (UCDA).
The latest export figures are a far cry from the average of 66,600 bags exported to Sudan monthly in previous years, translating into 0.8 million bags annually, making Sudan the leading importer of Ugandan coffee on the continent.
“They are not buying from Uganda, primarily because of restrictions on finances,” said Suresh Iyer, the branch manager of Olam Uganda Ltd, one of the major coffee exporting companies.
Bashir administration has put restrictions on how much forex goes out further hurting traders.
“The government has put restrictions on how much forex goes out, so the importers are constrained on that side,” Mr Iyer said.
The local currency has also depreciated, exchanging at 47.5 Sudanese pounds to the dollar further dealing a blow to Uganda’s coffee sales.
Traders now fear that if the economic woes and the growing social unrest persist in Sudan — which accounts for up to 17 percent of Uganda’s coffee exports annually — the crisis could as well determine how the country’s leading commodity export fares this financial year.
Uganda’s coffee export industry is now counting on the regime in Khartoum to quickly resolve the situation and see to it that the country has sufficient stocks of coffee as the Islamic holy month of Ramadan approaches in three months’ time and later, Eid El Fitr celebrations mid this year.