Uganda expects to increase coffee exports to 250 thousand 60 kg bags in January from 237 thousand in December, boosted by a rise in prices, a source at the state-run Uganda Coffee Development Authority (UCDA) said on Saturday.

The east African country is one of the continent's leading exporters of the beans, which are a major source of its foreign exchange inflows. It primarily cultivates the robusta variety.

"Farm-gate prices have risen substantially, and for rational farmers this should prompt them to sell their stocks, because they would realize higher earnings. That's why we think January's exports will rise compared with last month's," the source said.

While the month-on-month increase amounts to 5.5 per cent, January exports would be down 5.4 per cent from the 264 thousand bags exported in the same month last year.

The UCDA source said a kilo of unprocessed dry Robusta beans had risen to 2 thousand shillings from 1,7 thousand shillings around October.

Farmers are also expected to sell greater volumes of their stocks ahead of the commencement of the school term.

"Children are about go back to school and the farmers need (money for) school fees, so they're selling everything in their stores," the source said.

UCDA forecasts Uganda will ship 3.1 million bags of coffee in the October 2010 to September 2011 season, up from last year's 2.67 million bags, which fetched $267.2 million.