Ethiopia coffee exports falling, pins hope
sesameBuzz up!
* Coffee earnings seen falling by 30-40 percent
* Falling exports fuelling currency crisis
* Ethiopia could become world's top sesame exporter
22 May, 2009 | By Barry Malone
ADDIS ABABA, 22 May, 2009 (Reuters) - Ethiopian coffee exports
will fall by 30-40 percent in 2009/2010, but the country hopes to
become the world's biggest sesame seed exporter this year, the
Ethiopian Commodity Exchange (ECX) boss said on Friday.
export earnings relative to last year," she told Reuters in an interview at
her office in Addis Ababa.
"But we are projecting to export 225,000 tonnes of sesame, earning
about $250 million, which is likely to make us the world's largest
exporter."
The ECX began trading sesame for the first time last month and
potential investors in the sector from China and India have already
visited the Horn of Africa nation, Eleni said.
Africa's biggest coffee exporter is also the world's fourth-largest
sesame exporter after China, India and Myanmar, exporting 124,291
tonnes of sesame last year.
Eleni said Ethiopia could set the benchmark price for sesame in the
future. "It's a big ambition for a little country, but we have that
potential," she said.
Coffee accounted for some 60 percent of Ethiopia's foreign exchange
revenue in the 2007/2008 (June/July) season, when it earned more than
$525 million from exports of 170,888 tonnes of mostly high quality
arabica beans.
But Eleni said the cash-strapped nation would only make about $300
million from its biggest hard currency earner this year, partly due to the
global economic slowdown.
"It's not insignificant that some of the higher-end premium coffee
outlets are scaling back," she said. "Starbucks closing 600 stores
around the world has implications for demand for the type of premium
coffee that Ethiopia exports."
Ethiopia has been suffering from a shortage of foreign currency as
commodity prices have fallen worldwide and demand for its mostly
agricultural exports has slipped.
DIRECT IMPACT ON EARNINGS
Prime Minister Meles Zenawi warned last month reserves stood at just
$850 million versus a target of at least $1.2 billion.
The government has said it expects economic growth of 11.2 percent in
2009. The International Monetary Fund has predicted growth of 6.5
percent for Ethiopia this year.
"The global coffee market has had a direct impact on our foreign
exchange earnings and our economy is having to face that at the
moment," Eleni said.
The ECX was set up to replace a murky auction system. But some
Ethiopian exporters have been reluctant to sell their beans through the
new exchange, which began trading coffee in December.
The government seized 17,000 tonnes of the crop in March and
revoked the licences of six exporters it accused of hoarding their stocks
and waiting for prices to rise.
When a state-owned body then exported the seized stock, some in the
industry accused the government of nationalising its most valuable
export business. The government denied that.
"It was a one-time corrective action," Eleni said. "An attempt to send
the signal that we have to keep export earnings going because the
country is in a crisis."
Exports have also been shaken by Japan's insistence on testing
Ethiopian coffee beans on arrival after it found some last year that were
contaminated with pesticides. That effectively halted exports to a
country that once bought about 20 percent of Ethiopia's beans.
Ethiopia prides itself as the birthplace of coffee. Some 15 million
smallholder farmers grow the crop, mostly in the forested highlands in
the huge country's west and southwest.
(Editing by Daniel Wallis)
Courtesy
sesameBuzz up!
* Coffee earnings seen falling by 30-40 percent
* Falling exports fuelling currency crisis
* Ethiopia could become world's top sesame exporter
22 May, 2009 | By Barry Malone
ADDIS ABABA, 22 May, 2009 (Reuters) - Ethiopian coffee exports
will fall by 30-40 percent in 2009/2010, but the country hopes to
become the world's biggest sesame seed exporter this year, the
Ethiopian Commodity Exchange (ECX) boss said on Friday.
- Ethiopian officials
have blamed bad
weather for near total
crop failure in some
southern growing
zones this season, and
ECX chief executive
Eleni Gabre-Madhin
said the global
economic slowdown
was also hurting
overseas sales.
export earnings relative to last year," she told Reuters in an interview at
her office in Addis Ababa.
"But we are projecting to export 225,000 tonnes of sesame, earning
about $250 million, which is likely to make us the world's largest
exporter."
The ECX began trading sesame for the first time last month and
potential investors in the sector from China and India have already
visited the Horn of Africa nation, Eleni said.
Africa's biggest coffee exporter is also the world's fourth-largest
sesame exporter after China, India and Myanmar, exporting 124,291
tonnes of sesame last year.
Eleni said Ethiopia could set the benchmark price for sesame in the
future. "It's a big ambition for a little country, but we have that
potential," she said.
Coffee accounted for some 60 percent of Ethiopia's foreign exchange
revenue in the 2007/2008 (June/July) season, when it earned more than
$525 million from exports of 170,888 tonnes of mostly high quality
arabica beans.
But Eleni said the cash-strapped nation would only make about $300
million from its biggest hard currency earner this year, partly due to the
global economic slowdown.
"It's not insignificant that some of the higher-end premium coffee
outlets are scaling back," she said. "Starbucks closing 600 stores
around the world has implications for demand for the type of premium
coffee that Ethiopia exports."
Ethiopia has been suffering from a shortage of foreign currency as
commodity prices have fallen worldwide and demand for its mostly
agricultural exports has slipped.
DIRECT IMPACT ON EARNINGS
Prime Minister Meles Zenawi warned last month reserves stood at just
$850 million versus a target of at least $1.2 billion.
The government has said it expects economic growth of 11.2 percent in
2009. The International Monetary Fund has predicted growth of 6.5
percent for Ethiopia this year.
"The global coffee market has had a direct impact on our foreign
exchange earnings and our economy is having to face that at the
moment," Eleni said.
The ECX was set up to replace a murky auction system. But some
Ethiopian exporters have been reluctant to sell their beans through the
new exchange, which began trading coffee in December.
The government seized 17,000 tonnes of the crop in March and
revoked the licences of six exporters it accused of hoarding their stocks
and waiting for prices to rise.
When a state-owned body then exported the seized stock, some in the
industry accused the government of nationalising its most valuable
export business. The government denied that.
"It was a one-time corrective action," Eleni said. "An attempt to send
the signal that we have to keep export earnings going because the
country is in a crisis."
Exports have also been shaken by Japan's insistence on testing
Ethiopian coffee beans on arrival after it found some last year that were
contaminated with pesticides. That effectively halted exports to a
country that once bought about 20 percent of Ethiopia's beans.
Ethiopia prides itself as the birthplace of coffee. Some 15 million
smallholder farmers grow the crop, mostly in the forested highlands in
the huge country's west and southwest.
(Editing by Daniel Wallis)
Courtesy
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| Coffee Ruining a Nation By Dereje Hailu Kassa "..Despite the fact that it became a lucrative global business worth $55 billion a year, for more than a million Ethiopian farmers accounting for nearly 15 million households, it is a burden that no one wants to carry on any longer." More |
