Ethiopia Coffee Growers Expect Another Record Year for Exports
(Bloomberg) -- A deteriorating political crisis in Ethiopia, Africa’s biggest coffee producer, hasn’t disrupted exports and growers expect another record year as foreign rivals struggle.
Ethiopia exported 86,000 tons of coffee during the three months through October, generating $327.9 million, 77% more than projected, according to the Ethiopia Tea and Coffee Authority.
The nation exported 250,000 tons during the marketing year that ended July 31, earning a record $910 million, according to authority figures. Ethiopian coffee exports are forecast to reach 280,000 tons in the current fiscal year and generate $1.1 billion.
Thousands have been killed and hundreds of thousands displaced since fighting erupted in late 2020 between central government forces and the Tigray People’s Liberation Front.
“Our exports haven’t been affected” by the conflict, Adugna Debela, director general of the tea and coffee authority, said during an interview from the capital Addis Ababa. “There is no problem in Djibouti port and the Addis Ababa-Djibouti road is working peacefully; so the way we measure it is in our daily volumes.”
Africa’s largest producer and consumer of arabica coffee beans has increased output steadily over the past three years. Last week, the central government declared a six-month state of emergency in a conflict that’s so far been confined to areas outside the main coffee-growing regions.
Meanwhile, shipping costs have risen so much in Asia that buyers of the robusta variety of beans are searching out alternatives to Vietnam, the top exporter of that grade. According to Rabobank International, Uganda has benefited as robusta exports jump to the highest in 30 years.
Arabica prices have surged more than 60% this year in New York after frosts and drought slashed output in top producer Brazil. Second-ranked Colombia is also struggling with too much rain.
Because of the higher world prices, some farmers have abandoned delivery contracts signed when markets were weaker. Saudi Arabia, Germany, the U.S., Japan, and Belgium are the biggest buyers of Ethiopian beans.
“Some of the exporters are negotiating on those prices and there are companies that do that,” Adugna said.
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