The Coffee and Tea Authority is continuing with their ECX Maximum price policy, however price limits have been increased so there is less tension between collectors (Agrabes) and the C&TA. Export Registrations of Washed Coffee are very disappointing so the pressure is on for the C&TA to reduce minimum registration prices for grade 2 coffees from the South. Volumes at ECX are still reduced and shippers continue to struggle to cover shorts established long ago and in many instances rolled over. Some of the larger exporters have stopped offering for nearby shipment not wanting to increase their very short positions. Several donor organisations are limiting their support to Ethiopia over concerns of Government actions in the North of the country so we expect that pressure is mounting on Exporters bring in foreign currency to alleviate the shortfall in overseas remittances from international partners.

Unknown assailants attacked a village in North Western Ethiopia and it seems that a massacre has taken place. This comes the day after the Prime Minister toured the area, therefore it is an obvious conclusion that this occurrence is linked to the PM visit and the recent fighting in Tigray region. It always was a real concern that having stabilised the main cities in Tigray, the security forces would be facing guerrilla warfare and terror attacks. We expect that these strikes towards civilians will only strengthen Central Government resolve to subdue Tigray fighters. Peace in Ethiopia is not assured in the near term.

The harvest is entering its closing stages, cherry prices range between 20 and 27 Birr per kg, a considerable variation in prices and depending on the area. In Yirgacheffe  areas competition is strong, whereas in other areas coffee is starting to dwindle and there is less demand.

Birr 38.94 to the USD

Have a nice weekend, stay safe over the festive period.


In early 2020 the Coffee and Tea Authority introduced Minimum Registration Prices for export coffee, now we have Maximum Sales Prices at ECX! Consequently Agrabes stopped selling coffee at ECX! It is easy to understand why, one day you are selling at 1,900 and the next the price is capped at 1,300! In recent weeks ECX prices have been driven upwards on tight supply and huge demand, both for Export and by Internal Demand, Exporters complain that the ECX price is too high but I am not sure that capping the price is going to help exporters…

Exports in November decreased as is normal for this time of the year, however the pace of sales is much lower viz a viz 19/20;  the period May to November 2020 is 46 k MT behind the same period May to November 2019:

May           25,967           28,449
June           25,790           29,294
July           19,015           26,512
August           19,995           30,279
September           14,443           23,696
October           13,018           19,966
November           11,964           18,328

(Export figures in MT)

Meanwhile registered sales of Washed New Crop 2020/21, for shipment first quarter 2021, is very low as a direct consequence of the high Min Prices for Sidamo and Yirgacheffe, these grades cannot be registered below 220 c/lb; Limu seems quite reasonable at around +50 FOB equivalent. Steady business for Lekempti and other Naturals for both current and new crop this week.

Birr 38.48 vs USD

Have a good weekend.


Ongoing limited supply to ECX with Djimmah 5 trading at around 175 c/lb FOB equivalent; FOB buyers are bidding around 95 c/lb and the local market is paying 350 c/lb, so it is no surprise that shippers do not have anything to sell and that coffee is not arriving at ECX warehouses. Any coffee that is around is finding it’s way to the local market illegally but the incentive is too great. Volumes of Naturals at ECX are pitiful, yesterday 166 MT of Sundried (all grades) were offered; we do not expect to see any meaningful quantities of Djimmah type until February and Lekempti/Sidamo (Natural) until March so local tightness is likely to continue for a few more weeks.

Minimum registration prices for New Crop Sidamo 2 is over 220 c/lb FOB, which is too rich for most standard Sidamo 2 buyers. The Coffee and Tea Authority (CTA) does not seem to understand that there are different qualities of Sidamo 2 and that most will only find a market if traded at much lower levels; in time we believe that this minimum registration price will be reviewed to better reflect levels where larger buyers and standard quality is tradable.

Ethiopia appears to be much more peaceful this week although there remains a heavy military presence in Tigray region.

Birr/USD = 38.34

Have a gd wkend.


Government forces have taken the main town in Tigray region, Mekelle, however the TPLF leadership have not been arrested which was the main justification for launching the offensive in Tigray. For now the region is stable and not as tense has in the previous month of November. The focus seems to have moved to aiding the displaced population that are in need of food and other basic necessities.

Exports continue to disappoint, during the 6 month May to October 2020 vs same period in 2019 volumes are down by 40 k MT or 25%. If you only look at the last 4 months, the drop is even greater at 34% between 2020 and 2019. This poor pace of shipments is expected to continue until the New Crop starts to be exported which could be early 2021 as the harvest was early and the weather conditions post-harvest favour parchment drying. Quality wise indications are that the crop is good and better than 19/20 quality. Reported cherry prices are still very high, as much as 27 Birr per kg in Yirgacheffe.

Birr 38.20 = USD 1

Have a good wkend.