Ethiopian Millers Association express concerns over shortage of wheat supply to their factories.
According to the association, which has more than 220 member factories, it usually buys wheat from different parts of the country based on the season and the type of wheat including from Bale, Awash, Arisi, and Gojam.
According to Muluneh Lema, president of the association, based on the season, factories had been expecting wheat supply from Bale, Oromia Region’s largest wheat producer, however, the wheat market has been rattled by interruptions for the past five or six weeks especially in the capital Addis Ababa.
“Beside wheat price increasing by more than one thousand birr per quintal it has been more than five weeks since the factories that produce flour and related products stopped getting wheat from the market,” said Muluneh, adding that, “A number of factories are cutting their production of flour.”

As the association indicated previously one quintal of wheat used to be sold for 4,700 birr which now has jumped to 5,700 birr.
“We have also confirmed through field observations that Ethiopia has increased its wheat production,” said the president explaining that he is confident that there will be no shortage of wheat production this season.
However, due to the interruption of the wheat market, the president alluded that factories are also buying smuggled wheat at high prices.
A week ago, Prime Minister Abiy Ahmed attended the national wheat export launch program in Bale Zone, Oromia Region as part of the government’s plan to halt import of wheat and embark on the export of its own wheat production.
According to the Ministry of Agriculture from this year’s autumn harvest season, 112 million quintals and 52 million quintal of wheat production from irrigation and summer season is expected to be reaped.
Therefore, the forecasted production rate indicates that there will be excess production in terms of domestic demand which is estimated at 97 million quintals with an additional 32 million quintals of wheat being projected for export.
Muluneh stated that although they are very supportive of Ethiopia starting to export wheat, they do not think that the export trade will create a problem for the domestic wheat market as this year a high level of production has been produced at the national level.
“Even those who were getting the supply in different ways or using from their stock may not continue for long if the situation is not solved quickly and it may affect the supply of bread and other products,” the president indicated.

Ever since the problem occurred, the association has been informing the Ministry of Trade and Regional Relations and the Ministry of Finance by letter, and they believe that the efforts they are making by going to the front will yield results.
It is said that one of the reasons of the unintended wheat trading problem is related to the inability to properly implement the Oromia region’s wheat trading guidelines.
According to Muluneh, in a meeting held in Adama with the relevant government, it was decided upon for unions to supply wheat to factories from farmers at rates of one quintal of wheat with 3,200 birr and to sell it to factories for 3,381 birr.
“When we follow up on which unions we are working with, the unions did not get enough financing, and after that it almost fell flat with unclear information,” said Muluneh.
Muluneh, emphasized that production in itself was not the thorn in the scenario but the way how the market process is run.

The fall in international coffee price raises rate of contract terminations of coffee export as the Ethiopian Coffee and Tea Authority (ECTA) signals concern citing that the authority in talks with buyers to finish exporting stored export standard coffee within 3 months.
“As a result of decrease in the international coffee price, export volume has also decreased,” said Adugna Debela /PhD/, head of the authority, indicating that the past six months have shown slight decrease in volume while revenue showed increments of 80 million dollars from last year but still only meeting 67 percent of the target.
In the first half of the fiscal year, the country exported 117,000 tons of coffee worth USD 663 million as the authority target to generate USD two billion over the course of the current fiscal year by exporting 360,000 tons of the beans.
“Due to international price decrease exporters are hoarding their coffee as the price they get locally is expensive than the international price they anticipate to sell to, rendering them to hold on to the coffee for speculated increase. We are working to improve the situation by engaging with different stakeholders including buyers,” said the ECTA head.
As data shows, a pound of coffee cost USD 2.5 during a year back. However, the number now has dropped to USD 1.5, a decrease of $1 per pound and almost $2 per kilogram of coffee.
In the first half of the fiscal year, 288 contracts with 181 exporters were terminated, according to the authority.
“Exporter have large amount of stocked export standard coffee due to termination of contracts. We are in discussion with buyers to solve the matter and to increase the volume and with exporters to review their contract,” said Adugna, adding, “We believe in the two or three months exporters will finish exporting coffee they have in their backlog stock due to termination of contacts. This is one measure to achieve our target.”
The cost of the item has decreased by 50% on the international market since last year. Less purchasing power has caused a decline in interest from buying nations. Ethiopia’s attempts to make money off the commodity are hampered by both of these circumstances. Brazil is also making a return after suffering a frost disaster that destroyed its coffee plantations.
“There is no shortage of supply and volume, however, due to the situation there is a slowdown in the interest of buying countries which we have to wait until situations improve,” Adugna emphasized.
“Ethiopian coffee is one of the best qualities in the world and we are always improving. We believe that having high quality would get us to increase the revenue even though volume shows decrease from last year,” he further explained.
Throughout the course of the preceding year 2021/22, for the first time ever, coffee exporters came together to supply the global market with goods valued USD 1.4 billion from the exports of 300,000 metric tons of coffee.
Also Ethiopia was able to earn USD 1.75 billion from exports during the first half of the 2022–2023 fiscal year, according to the Ministry of Trade and Regional Integration.
Exports of manufactured goods, dairy and meat products, electric power, and mining products each contributed 10%, 2.9%, 2.9%, and 6.62% of the total revenue, respectively, while exports of agricultural commodities generated 77.23% of the overall income.
According to the Ministry, the nation met 76% of its export goal during the previous six months. It cited poor global demand and smuggling of agricultural goods into neighboring nations as reasons why the goal export volume was not reached.

The Ethiopian Shipping and Logistics (ESL), a dominant figure on the inland fleet scene in the region, discloses that it may consider adding more trucks to its fleet owing to the lack of saturation in the market.
During a ceremony held on February 16 at its Mojo facility, 78km east of Addis Ababa, the logistics giant officially disclosed that the new coming 185 trucks are scheduled for operation.
Wondimu Denbu, Deputy CEO for Corporate Service at ESL, told Capital that ESL, which recently rebranded its logo and name, has become a dominant player on the inland transport service since its truck collection expanded in the past few years.
As Wondimu explains, the good number doesn’t mean that the shipping firm may not add more to its fleet.
“Despite our big ownership in the field, the demand is still very high. Annually, we lease a big volume of trucks to transport cargos to the center,” the Deputy CEO explained.
Due to that ESL may consider to buy more trucks in the near future though at the current stage there is no plan on the table.
“The country demand for inland transport is very high. Based on that, we may add more trucks on our ownership fleet,” Wondimu explained.
The 185 new trucks, which set the firm about USD 15 million, now expand the trucks administered by ELS to close to 635. Over the years, ESL has often excluded old trucks from its ownership primarily for cost effective reasons of its handling of long distance operation on the way to Djibouti and other part of the country.
In the past budget year, the government’s logistics arm floated different bids to buy trucks, while some of them failed for different reasons.
For instance, on its failed float, ESL had tried to buy trucks on a differed letter of credit (LC) scheme, while it only managed to attract a Chinese company.
When the logistics firm refloated for the second time in March last year, with a bid opening on April 8, the enterprise invited bidders to submit their offer on both; normal procurement procedure and or deferred LC alternatives and finally concluded the process under direct LC.
“We benefit buying trucks on direct LC since it has a better specification, loading capacity, quality and even price,” Wondimu said.
He explained that on the scheme buying trucks through differed LC the process is undertaken through agents or partners that would have additional charges, “but when you buy the product on direct LC it is held directly with manufacturers due to that different incentives shall be added besides leveraging the negotiation.”
As per the process, the latest supplier is Sinotruck International Co, which is known for its heavy-duty trucks, Sinotrucks, and was coincidentally the company that won a year ago to supply 150 Sinotruck vehicles at the cost of 11 USD million.
The coming of additional 185 units of 6×4 track tractors with 3 axle cargo semi-trailer makes the Chinese prominent brand; Jinan Sinotruck heavy duty trucks a dominant the collection of the ESL inland transport arm.
The total cost of the 185 trucks is about USD 14.56 million, while the procurement of feed kits, recommended spare parts, and diagnostics laptops and software have been concluded at the cost of USD 665,123.
The trucks that are assembled at the arrival point in Djibouti have been engaged on transporting cargos be it containers or bulk.
Currently, ESL has about 373 Sinotrucks, 215 Renault brand of French and 17 units of car carrier trucks that were bought from Renault.