Capital Ethiopia Newspaper

New law shakes coffee exchange

The Ethiopian Commodity Exchange (ECX) has announced that the price and quantity of coffee shrivelled on the exchange market after the Ministry of Trade imposed a new law on coffee exporting. 
Eleni Zaud Gebre Medhin (PhD), CEO of the exchange, said that in the past week coffee exporters have reduced their participation in the market. As a result, the price of coffee has declined significantly on the exchange floor.
The ministry office has ordered exporters to export their coffee in bulk as of November 11, while previously exporters were exporting the bean by the bag.
After the ministry announced the new rule, exporters complained they did not have the capacity to comply.
Dr Eleni said that the system should help the market if the country wants to earn hard currency.
“We had not involved with implementing the new law because it is the ministry’s mandate. However, since the problem arose last month we have been working with the ministry and other stakeholders to solve the problem,” she added.
The CEO said that she is expecting the problem will be solved within two weeks.
Last week exporters went to the Prime Minister Office to ask that the law be suspended.
According to exporters, based on the new exporting law the amount of coffee that would be exported for international clients highly declined, though some of them are trying to export the bean in bulk.
Coffee suppliers are supplying the product in bags for the ECX market, while buyers and exporters have received the bean through the same system.
Exporting or transporting in bulk is usual in other countries for different types of grain. The Ministry of Trade has rejected exporter’s request to suspend the new law until they facilitate the preconditions and convince their international customers about the new system.