Ethiopia eyes to bag third spot in coffee export market

By our staff reporter
During a discussion with media leaders on Thursday, August 4, Prime Minister Abiy Ahmed expressed Ethiopia’s ambition to become the world’s third-largest exporter of coffee. Currently ranked as the 8th largest coffee exporter globally, Ethiopia has been diligently working towards this goal. In recent years, millions of coffee seedlings have been planted in the country, reflecting a strong commitment to the industry’s growth. Prime Minister Abiy expressed his hope that within the next two to three years, Ethiopia will successfully ascend to the coveted position of the third-largest exporter of coffee beans.
In 2021, Oromia signaled continued expansion of seedling coffee and replacement of decades-old trees. In its recent article, the World Bank (WB) said that almost 80 percent of Ethiopia’s 1 million hectares of coffee trees were underproductive because the trees were not trimmed often enough.
According to the WB article, the quality of Ethiopian coffee isn’t the problem. About 95% of production from the country’s diverse coffee varieties is organic, traditionally cultivated without the use of pesticides and fertilizers. Demand isn’t the issue either.
The article however questions, why is Ethiopia’s coffee productivity lagging behind other leading coffee-producing countries such as Brazil, Colombia, Indonesia and Vietnam? As the research shows, the problem boils down to a lack of pruning.
Shimelis Abdisa, President of Oromia region, back then said that unlike the preceding trend for the past couple of years the regional administration has given fundamental attention for the bean production and productivity.
“In general, previously, the Ethiopian government was only generating revenue from coffee but not investing on it. The farmer was the only actor on the total production activity,” he said.
The WB said that the low productivity of Ethiopia’s coffee trees poses an obvious problem for the more than 2 million smallholder farmers dependent on coffee production for their livelihoods.
Shimelis said due to different reason including the trading scheme, the farmers’ revenue from the bean have been declaimed that led them to cut the coffee bush and replace them with alternative profitable crops.
“Based on understanding the farmers and the sector challenges, the regional government is taking action to come up with a solution,” the regional President said.
“In our region for the last two years we have introduced three major changes on the sector. Basically we have improved the marketing system by creating alternative trading for Ethiopian Commodity Exchange by issuing an export license for the farmer enabling them for direct export which also contributed to reduce the illegal trade,” Shimelis told Capital.
“The new trading plays a key role. It has shown positive results for instance the price of red cherry that was 12 birr per kg in the past has now reached 30 birr because of the new scheme,” he explained.
The other initiative introduced in the past two years was rejuvenating and replacing the aged and unproductive coffee trees by new seedling.
The regional President said that the coffee trees in the region are aged up to 40 year, which is a factor for small harvest.
“Rejuvenate existing trees by trimming and replacing of the old trees and seedling new coffee trees in new areas has been conducted for the past two years,” he said.
“In 2019, we have planted over 800 million new coffee seedlings, 900 million in last year and in this rainy season we will plant 1.1 billion coffee trees in the region,” Shimelis elaborated.
The World Bank article said that different initiative have been involved to elevate the challenges like Stumping involves pruning older and less productive trees down to just a stump. “This stimulates the growth of new sprouts that develop into new branches within a few months,” it added.
According to the region’s plan, the target is increasing the coffee export by two folds in minimum in the coming few years. “In the past budget year for instance for the first time in the region the coffee export have increased by 17 percent and in this year it is expected to climb to 19 percent,” he explained.
In the coming budget year the export is estimated to be boosted by 25 percent because the seedling that was planted two years ago will have started production.
The price increment at farmer’s level under one of the three pillar of change for the sector has also discouraged the illegal market. The effect on the illegal channel is said to contribute to attaining the target set for the coming year.