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.

Around 500 million birr is said to be invested by BGI to upgrade, remodel, and expand the Meta Abo Brewery.
In a ceremony conducted at the Meta Abo Brewery in Sebeta, Harve Milhade, CEO of BGI Ethiopia, gave a presentation to participants about the initiatives taken over the preceding six months. The new CEO of BGI Ethiopia noted in his speech that BGI had promised to increase the Meta Abo Brewery’s capacity, rebrand it, and take care of the business, as well as to forge tight ties with the residents of Sebeta, the local government, and other stakeholders.

The four pillars of BGI’s operations are allegedly human capacity, production capacity increase, sales and distribution, and corporate social responsibility.
As previously said, BGI has devised a human resource plan that includes training citizens to become job creators and skill developers. As a result, Ethiopians now have complete administrative control of Meta Abo. The staff of the organization has also moved into newly built offices, and the development of industrial worker changing facilities is almost finished. Furthermore, there have been 1,500 job openings in the Sebeta region since BGI started its restoration and growth activities.
With a monthly capacity of 300,000 hectoliters and three megawatts of power, BGI Ethiopia plans to make Meta Abo the largest brewery in the BGI family. It is making investments in the purchase of new machinery for production, such as a sizable generator with a large output.

The Trade Competition and Consumer Protection Authority (TCCPA) gave BGI Ethiopia, a subsidiary of the Castel Group, the go-ahead last year on April 2022 to complete the acquisition of the Meta Abo Brewery from British multinational beverage alcohol business Diageo.
Initially disclosed at the start of the year in January 2022, the beer monopoly’s plan to acquire a rival in the sector would allow it to further consolidate its domination in the local market.

The economic crisis in the western world strikes the Ethiopian flora export during the rosy romantic week of Valentine’s.
February, one of the peak seasons for the flower growers and exporters, often gets high returns in value generation. However, this year’s global narrative has not lived up to expectations. The result has had a ripple effect on the flower export in Ethiopia which has shown slight reduction. Nevertheless, the sector has continued to register more foreign currency with an annual growth rate.
According to the information Capital obtained from Ethiopian Horticulture Producer and Exporters Association (EHPEA), for the romantic day festivities Ethiopian flower growers exported 2,165.33 tons of the products to the global market with an estimated value of overUSD 3.2 million in the period spanning from February 1 to 13, 2023.
Yemisrach Berhanu, Promotion and Information Service Head at EHPEA, explained that the auction market in the first week of the month was relatively slow, but later gained traction in the second week, “This gained traction made the Ethiopian growers to export more product in the period.”
Yemisrach however noted that this year’s export in relation to Valentine’s Day was lower in contrast to the preceding year.
“This is not unique to our product alone but it has happened for all flora industry players worldwide,” she said.
The Promotion and Information Service Head explained that the inflation occurring in Europe, which is the major destination of Ethiopian flowers, was one of the reasons for the slowdown in the market.
Experts alluded that the economic downturn and price hike on the commodities led it to have a lower performance this season.
Valentine’s Day is very important for the country’s flower sector as its one of the holidays in which the flower industry flourishes and increases production from 35 percent to 40 percent. In February 2022 Ethiopia exported 2714.45 tons of flowers for the lovers’ day.
Despite being a late comer to the export basket, the horticulture sector has achieved spectacular successes. Even when the sector was severely affected by COVID 19, the Ethiopian export earnings from the horticulture industry, which takes on average 15 percent of thetotal export earnings, was massive.
In the first quarter of the 2022/23 budget year, the floriculture sector generated USD 167.3 million up from USD 122.6 million a year back.
“Export receipts from flower increased by 36.5 percent due to a 26.2 percent growth in export volume and 8.2 percent in international price,” reads the National Bank of Ethiopia quarterly report.
It added that as a result, the share of flower in total merchandise export increased to 17.1 percent from 12.6 percent a year ago.
In the 2021/22 budget year, the flower export climbed by 15.1 percent from the preceding year to generate USD 541.6million.