The recent upwards swing in NY has allowed for much selling activity in Addis. It started last week and really took off this week! Some shippers are now well sold and not so eager to offer. We expect that Minimum Registration Prices for Naturals to increase over the weekend. It would seem that we may be in for a more subdued couple of weeks ahead after the recent frenzy of activity. This surge in export registrations has come to the aid of Coffee and Tea Authority officials who were under pressure from Central Government to increase registrations. The World Bank has painted a rather gloomy economic picture for 2021 with a paltry 2% growth forecast, which if it comes to being, will be the lowest growth in recent years.

Meanwhile at ECX volumes on offer of lower grades (Grade 5) continue to frustrate shippers. As a consequence, the Vertical Integration craze previously limited to Washed Coffees has spread to Natural supply chains, as larger shippers see too much competition at ECX from small (sometimes tiny) shippers which have mushroomed in the last few months. Likewise overseas buyers are having to expand their supplier network to find the volumes they want to contract.

Below we compare some data about the current crop from different sources, interesting to see how some of the figures vary so much:

Birr 39.97 = USD 1

Have a great weekend.


It happens every few years, in adverse conditions, some shippers get it wrong and struggle to stay afloat in a sea of adversity! In 2020 internal and external factors, some coffee related and others not, some new and some never experienced before, combined, resulting in some of the top shippers in Ethiopia struggling to cope. The table below ranks the shippers´ volumes for the six month period July to Dec 2019 vs July to Dec 2020, the conclusions are clear to see. Since overall exports July to Dec 2020 are down to 70% of the volume same period in 2019, any shipper above that 70% figure is doing well. Some, unfortunately, are clearly not!

Exporter volumes in MT

We have been here before, this is not new, shippers that are doing well seem to nearly disappear from one year to the next; while others clearly flourish in generally difficult times.

Birr 39.80 to the USD

Have a good weekend.

The trend continues, total shipments for 9 month period, May 2020 to January 2021, 155 K MT which is 25% lower viz a viz the previous year. By all accounts February shipments are also progressing at a reduced pace. We are coming to conclusion that by April shipments will be 1 M bags lower than the previous 12 months.

(Ethiopia Exports in MT)

In other news there were some worrying headlines regarding a possible restructuring of Government Debt held in Private hands. This news comes as the Government is reworking its debts to the Paris Club. After these negotiations are finalised it is expected that the Government will seeks similar arrangements with Private creditors. The effects of the pandemic on the economy have been further exacerbated by the conflict in Tigray leaving the Ethiopian Treasury in a pickle.

At ECX washed coffees are selling well, with agrabes happy to accept exporter bid levels as volumes offered increase weekly; the inverse is true for Naturals, where agrabes are reluctant to accept bids, as exporters vie for the reduced volumes available. Most of the “new” licensed exporters are active in lower qualities market (Grade 5) and there are so many competing for what is offered that agrabes believe they could be achieving higher prices than the Maximum Prices set by ECX. Meanwhile, we believe that larger exporters continue to rollover contracts as buying to cover old commitments is nearly impossible.

Birr 39.65 to the greenback

Have a good weekend.


It is a well known fact that many companies in Ethiopia involved in the import business are attracted to the export of agricultural commodities to access the foreign currency needed to pay for goods that are imported into Ethiopia. Many companies that have investments in construction, manufacturing and consumer good distribution are attracted to the coffee export business solely to maintain their main activity operating. In recent months even more companies have gotten into the coffee business and are buying whatever they can at ECX to have something to export. More established shippers are really struggling to buy at ECX what they need to fulfil commitments. The supply to ECX is reduced by the current standoff between ECX and Agrabes regarding Maximum prices! As a consequences of increased demand at ECX and reduced supply from agrabes, established exporters are intensifying their efforts to access Natural coffees through Vertical Integration at farmgate level, therefore bypassing the ECX altogether. This will ensure that established shippers have coffee to ship and do not need to rely on ECX to source Naturals, however for those that rely on ECX as the main source, increased competition will negatively impact purchase price levels. At present supply is tight however as the flow from the interior to exporters increases we expect that the supply and eventually prices to normalise.

Birr 39.54 to the USD

Have a good weekend.