Coffee boosts Ethiopia's economy with $835m export revenue
Ethiopia, one of Africa's largest coffee producers, has reported a significant boost to its economy with an impressive $835 million in export revenue from coffee over the past nine months.
The Ethiopian Coffee and Tea Authority (ECTA) disclosed that the country exported 174,596 tons of coffee to the international market during the first nine months of the current Ethiopian fiscal year, which began on July 8. This shows strategic efforts in expanding its market reach.
Traditionally, Ethiopian coffee has found its way into the markets of Saudi Arabia, South Korea, the United States, Germany, and Japan. However, recent years have seen the Ethiopian government successfully penetrate new markets, including China, the United Arab Emirates, and Sudan. This diversification strategy has played a crucial role in the resilience and growth of Ethiopia's coffee export sector.
Coffee production is the backbone of Ethiopia's agriculture-led economy, and the country is celebrated for its coffee's rich quality. The global demand for Ethiopian coffee remains strong due to its unique characteristics.
Despite the impressive revenue from coffee exports, experts point out that the sector faces challenges, particularly in value addition. The majority of Ethiopian coffee exports are raw beans, which means the full potential of the sector is not being realised. There is a significant opportunity for Ethiopia to increase its revenue by investing in processing and branding its coffee for the international market.
According to a 2021 study by LIGS University, "Ethiopia's coffee export plays an essential role in the country’s economy. However, some obstacles affect the export process and expectations. Among them are product quality considerations, decreasing supply, increasing demand, lack of price negotiations, and product branding. Lack of promotion, lack of quality, continuity, lack of transportation, lack of modern sudden, lack of modern education to the farmers, and the other challenges, most Ethiopian coffee exporter companies have no confidence to answer the researchers' requests."
In the 2023 fiscal year, Ethiopia earned $1.3 billion from exporting around 240,000 tons of coffee. This marked a decrease from the record-high $1.4 billion revenue from about 300,000 tons of coffee exported in 2022.
