A delay in a two million ton procurement from abroad is harming the supply of wheat and wheat flour for the nation’s bakeries and flour companies.
Bakeries which were receiving 168,000 quintals under normal circumstance are now getting less than 83,000 quintals.
Last Thursday, Shoa Bakery and Flour Factory PLC, which has 16 branches in Addis Ababa and employs 1,150 people, surprisingly hiked its prices. Because they received less wheat flour they increased the price of 100 grams of bread from 1.30 birr to 2.50 birr. Shoa’s 300 grams of bread now costs seven birr.
The Addis Ababa Trade Bureau responded to the problem and gave Shoa their full quota of bread so they resumed to their old prices. Solomon Bekele, the Basic Commodity Distribution head at the Bureau told Capital that the full quota will be applicable when the procured wheat reaches the city.
“Wheat shortages have been a normal situation for a couple of years but to get into a sustainable position we must upgrade local products,’’ he said.
The Ethiopian Grain Trade Enterprise (EGTE) which distributes wheat to nine regions and two administrations is running out of stock and has not given any wheat to flour companies. They said the shortage occurred due to delayed procurement of wheat from abroad.
The Enterprise had been distributing 640,000 quintals of wheat every month to trade bureaus, universities, and prison administrations.
Under normal circumstances Oromia received 125,305 quintals per month while Amhara, and Tigray received 72,550 quintals, 66,417 quintals respectively.
Ethiopian Somali received 21,716 quintals while Afar and Gambela, Beneshangul received 20,875 quintals 20,700 and 20,001 quintals of sugar per month respectively.
The supply in all regions has been cut by more than 50 percent.
Recently Capital reported that the Addis Ababa Trade Bureau in response to complaints from bakeries regarding the price of bread made a study and brought it to the Trade and Industry Minister to adjust the price slightly.
The study which took into consideration the current inflation, the recent devaluation the birr, the price of input materials and the cost of labor and transport recommended increasing prices up to 80 cents. This would mean that 100 grams of bread which is currently sold at 1.30 birr will be sold at 1.50 birr while 200 grams will go for 2.50birr and 300 grams will be sold for 3.80 birr.
Procurement delays cut wheat flour supply by 50 percent
More palm oil importers approved
The Minister of Trade and Industry is selecting additional palm oil importers through the respective regional trade and industry office and the two City Administrations.
The new directive has been sent to the respective trade and industry offices to select the potential importers based on strict criteria.
“The Ministry gave the mandate to select capable importers and send them to the Trade Office in the name of transparency,” Wendemu Flate Communication Director of the Ministry told Capital.
Some of Trade and industry offices already began selecting importers based on the given criteria.
Currently five private companies are importing palm oil; AHFA PLC, Biftu Adugna Business S.C., Al-Sam International, Belayneh Kindie Import & Export (BKIE), and Hameressa Edible Oil S.C.
Moreover, the so called endowments such as Wendo Trading & Investment Plc, Guna Trading House Plc and Ambassel Trading House Plc, will also join the business. Alle Bejimla, the state-owned wholesaler, will also take part in the import.
“The assumption behind choosing those importers is on the consensus to build an edible oil factory and substitute imports,” Wemdimu said.
However no effort has been made so far to build factories in any of those endowments even though little progress has been witnessed in some of the private companies.
Ethiopia mainly relies on imported palm oil from countries like Indonesia, Malaysia and Singapore in order to satisfy its edible oil consumption.
Palm oil covers 96 percent of the total consumption while only four percent of it is covered by a few domestic manufactures with low level of production capacity and other importers.
Last fiscal year, Ethiopia imported 73,434 liters of palm oil according to the data from Minister of Trade and Industry.
Export revenue drops
Country earns 1.21bln USD for first half of 2018/19
Revenue from exports have continued to decrease as the country failed to hit its target for the first two quarters of the current fiscal year.
Though the government planned to collect USD 1.96 billion for the period, it has only achieved about 62% of its target.
The Minister of Trade and Industry, Fetlework G. Egziabher told Members of Parliament on Thursday that the country earned export revenue of 1.21 billion USD in the past six months.
The revenue falls short of 750 million USD from government’s target for the period, which was USD 1.96 billion.
The minister, who presented her report to the parliament, indicated that the instability witnessed in some parts of the country has also contributed to the decline of export income.
The other reasons the Minister mentioned is the failure of increasing productivity and reliance of raw agricultural commodities in addition to contraband border trade and lack of meaningful diversification of export items.
Lack of inputs for the manufacturing companies, which often can’t get hard currency on time is also mentioned as are reason for the failure of the emerging manufacturing sector to generate export earnings.
While Ethiopia’s export income has been declining, the country’s spending for imports has been growing, surpassing USD 17 billion last. As a result, of the growing trade deficit, Ethiopia has been facing an acute shortage of foreign currency to import medicines and fuel.
The major export earning commodities of Ethiopia include coffee, oil seeds such as sesame, flower, Khat, fruits, vegetables, minerals and some manufactured goods.
The major hard currency consuming products Ethiopia has been importing include fuel, different machines, medicines, steel, manufactured goods including foods as well as simple products such as, toothpicks, candies and cookies.
She also mentioned under-invoicing and absence of an export strategy as holding up the sector.
“The decrease of the revenue as well as its rate of decline have become very critical and needs careful consideration,” Fetlework added.
Improving agriculture, improving lives
The second national Agricultural Technique and Vocational Education and Trainings (ATVET) conference was held in Adama and consisted of discussions with schools and the Agricultural Transformation through Stronger Vocational Education (ATTSVE) project.
Partners around the world gathered and four colleges presented their progress report. 
Dalhousie University, Jimma University, McGill University and Mennonite Economic Development Associates of Canada (MEDA) are the partners.
In their report, the vocational schools stressed that the project helped them get the chance to improve their education. The gender-sensitive environment in the schools helped women who were students and teachers reach their potential. Strong gender offices have been established and sustainably funded by the project.
During the opening, a representative from the Ministry of Agriculture welcomed the attendants while stressing that improving agriculture is a pillar of economic growth and alleviating poverty.
“The government has produced more than 85,000 agricultural development agents from its 25 agro TEVTs,” Germame Geruma said.
ATTSVE has helped the schools provide laboratories, demonstration sites, and ICT infrastructure.”
Germame thanked the government of Canada which funded the project.
Representing Dalhousie University, the acting manager of international relations in the agricultural facility, said the exchange of scholars has been helpful.
“Students came here for an internship program this can help bo
th the Canadian and Ethiopian students exchange their experience” he said.
“When we launched the project there were some delays especially due to lack of foreign exchange and extended procurement procedures,” said Paul Kasanga, manager of the project. “I also hope there will be a continuation of the efforts to be sustainable. Woreta, Maichew, Wolaita Soddo and Nejjo are where the project is now.
