Strike while the iron is hot. For Ethiopia, that means sell—coffee beans in this case—while the market for good coffee is booming around the world.
Ethiopia, the birthplace of coffee, would like to become the second largest coffee producer in the world. But farmers have been doing well locally and prices at home are said to be even higher than internationally.
“In most cases, the domestic price is higher than international prices,” Fikru Amenu, an agent with the Ethiopian Coffee and Tea Development and Marketing Authority, said at the World Coffee Conference in March.
Ethiopians are the largest consumers of coffee in Africa, and a growing middle class in the East African nation of 93 million want to be served the best coffee.
In most other coffee-growing countries, most of their “best beans” end up in foreign coffee pots. Brazil, for example, exports 63 percent of its top crop, Colombia exports 89 percent, Guatemala exports 84 percent and Uganda exports 94 percent. Ethiopia exports 54 percent, a record low.
Still, coffee is Ethiopia’s top export and it earns up to a third of the country’s foreign exchange. The government wants hard currency to finance a light-rail system in the capital and a dam on the Nile.
But the plan to increase exports is likely to cause a shortage in the domestic market, which could attract low-quality imports to fill the gap.
In the fiscal year ending this July, the government hopes to increase the foreign exchange raised from coffee exports to approximately $880 million, a jump of nearly 13 percent from last year, Amenu said.
To do that, he said, traders would need to export at least 206,000 tons of beans, up 12 percent from the previous year.
Coffee traders have been mandated to export their best-quality beans. Only coffee beans damaged by insects or moisture can allegedly be kept in Ethiopia, The Wall Street Journal reported.
A fine of $2,000 and a jail term of approximately five years could be handed out to traders who flout the law.
To truly increase export volumes, Ethiopians would have to drink substantially less coffee. It is a target many say is nearly impossible.
“If you tell an Ethiopian not to drink coffee, no one will listen to you,” said Wondwossen Meshesha, the 28-year-old operations manager at Tomoca Coffee, a family owned roasting business and cafe chain famous for its macchiatos and fresh-roasted beans.
If the government takes a hard line on the issue, it could add to the already bad report just released by the U.S. State Department, which lists a wide range of restrictions on expression, assembly, association, movement and religious affairs.
A study of land grabbing in Ethiopia is also available online at www.oaklandinstitute.org.