Coffee Conference Aims to Boost Quality, Produce

On Thursday November 6, 2014 the Ethiopian Coffee Exporters Association (ECEA) held its third international conference, amidst dissatisfaction at the performance of Ethiopian coffee exports. In attendance were major players of the global coffee market, including Starbucks and Mondeleze International.

ECEA Chairman of the Board, Hussein Agraw, reported the event was a success, with only 35 international participants expected, but in fact 50 attended. This success reflects the growing popularity of the conference and increased demand for Ethiopian coffee, claims Hussein.

Mulatu Teshome (PhD), the president of the federal democratic republic of Ethiopia graced the conference with his presence. Also in attendance were Kebede Chane, minister at the Ministry of Trade (MoT), Roberio Oliviera Silva, director of the international coffee organization (ICO) and Peter Vrooman, deputy chief of the mission at the US embassy.

Focusing on traceability and quality, the conference discussed challenges and opportunities for Ethiopian coffee. A big opportunity for Ethiopian gains is the expected losses to the Brazilian market due to drought.

Ethiopia stands fifth in world coffee production, trailing far behind late comers to the global market such as Vietnam. Ethiopia exported 6.6 million bags of coffee (396,000tns, at 60kg per bag), delivering only a 4.5pc share of the global market. Brazil is the world’s largest coffee producer, with 49.2 million bags and a 33.85pc market share. Vietnam, Indonesia and Colombia follow Brazil, with 27.5 million bags, 11.7 million bags and 11 million bags, and market shares of 18.94pc, 8.04pc and 7.58pc, respectively.

The amount exported by Ethiopia in the 2013-2014 fiscal year was 190,837tns. This was lower than the amount exported at the beginning of the Growth & Transformation Plan (GTP) in the fiscal year 2010-2011 (196,118tns). Exports in 2013-2014 and 2010-2011 were valued at 719 million dollars and 841.7 million dollars respectively.

Africa’s share in global coffee exports have continued to decrease, said Roberio Oliviera Silva. Africa’s share in the 1990 world market was 20pc of the total world’s coffee. This has fallen to 11-12pc.

“Over the past two years, the world’s total coffee production stood at 145 million bags. The expectation is that this would rise to 175 million bags by 2020,” says Silva. “Therefore, because of the recent fall in Brazilian coffee, there will be shortages in coffee production.”

“The sector’s performance has remained far from satisfactory, with highly volatile international coffee prices, inconsistency in our quality and supply to the global market, and logistics,” said Mulatu, in his opening remarks to the conference, “therefore, our supply to the global market could not exceed the 200,000 metric tonnes level, despite the steady increase in coffee production.”

With 190 exporters, 280 importing companies, 85 green coffee processing industries and warehouses, and 47 destination countries worldwide, Ethiopian coffee has an opportunity to flourish in the world market, says Assefa Mulugeta, director general at the export promotion directorate at MoT.

“Opportunities for the Ethiopian coffee market are the well established brand, the positive image of the country as the birthplace of coffee, strong local coffee culture, varieties of coffee suitable for roasting industries, and potential for volume and quality expansion due to adequate land and inexpensive labour,” said Assefa.

Promoting Ethiopian coffee is one of the recommendations to help raise coffee export revenues. Assefa also suggested “branding and promotion, by strengthening business diplomacy capacity” needs to be adopted.

Working to achieve this, the conference has brought many big players in the coffee market to Ethiopia. As a consequence of the event, Ethiopian coffee is to be featured in a number of upcoming international conferences and expos.

Ethiopian delegates have been invited to participate in the coffee themed Cluster at the Expo Milano 2015. Ethiopia will also host the world’s 116th World Coffee Council in 2016. Furthermore, Ethiopia is to feature as a portrait country at the Specialty Coffee Association of American (SCAA) event in 2015. The country will also host the African Fine Coffee Association 2016 Exposition. Presenters at the 2016 conference hope to use it as a platform to promote Ethiopian coffee.

“The opportunity for Ethiopian coffee is to engender acceptance of the brand in the international market and for people to have positive impressions of it,” says Arthur Karutekua, director of green traceability at Starbucks.

One way to build that quality is establishing traceability, which the Ethiopian Commodities Exchange (ECX) is preparing to implement by June 2015. Picked coffee is the first commodity to pass through this system. Traceability begins by tagging coffee bags after processing at the point of washing, or hulling, stations to the buyer’s (exporter’s) warehouse. These “buyers scan each tagged bag as they process the coffee according to contract specification.” The traceability report then becomes available to roasters in the international market via digital passports.

During the conference the ECX demonstrated a prototype website for accessing traceability reports. Buyers will need a scanner and computer to scan the tags, says Solomen Edosa, an advisor to the ECX board. The system displays the supplier details, the customer details, and product information, including the place of production, processing stations, weight, terms of washed and unwashed coffee and the grade.

The system, which took two years to develop, will be rolled out in the coming coffee season. The ECX coffee traceability initiative was funded with 1.5 million dollars from the US Feed the Future program, under the USAID Ethiopia, with a contribution of 900,000 dollars from Dutch foundation IDH and coffee processing and trading firms Nestlé and Mondeleze.

The conference also hosted discussions to improve the quality of coffee, both at the plantation and processing points. The litter from shade trees will provide natural fertiliser for coffee trees, as well as averting some tree diseases, such as rust, says conference presenter Yilma Yemanebrehan, a chief advisor to MIDROC Ethiopia. Shade trees also regulate temperature, claims Yilma. The optimum annual average temperature for coffee is 18 degrees to 22 degrees; the marginal temperature is between 22 degrees and 23 degrees, with temperatures above 23 degrees and below 18 degrees, being unsuitable for plantations.

Wet washed coffee was also stated as one means of increasing the quality of coffee.

“The quality of coffee is increased by washing (processing red berries in wet mills immediately after harvesting) which better preserves the intrinsic bean quality, yields more homogenous product and fewer defective beans,” says Bart Minten, senior research fellow, International Food Policy Research Institute (IFPRI).

The conference addressed the major questions of coffee production, such as marketing and export. This year’s hope for the revenue from coffee export still hangs on the decline in Brazil’s production.

The conference saw discussion of Ethiopian market issues, with key players sharing their experiences and thoughts on enhancing the traceability and sustainability of Ethiopian coffee.

“We have to bargain in the marketplace and reverse the prevailing price trend, because our coffee is the best quality. The conference has paved the way for this. Previously we went to buyers’ to exhibit our coffee. Now we bring stakeholders to us to show our goods,” said Hussein.



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