Cherry prices have increased a tad this week, we have heard that agrabis are paying up to 30 Birr per kg of cherry. This price remains still well below last year’s cherry prices which reached 3 times as much. Weather continues favourable for harvesting. Benchi Maji has seen some rain but this is not affecting processing. Liquidity remains tight with cash to finance the crop very much reduced viz a viz past seasons. Banks had their fingers burnt during the last couple of years and now are reluctant to support exporters.

Saudis continue to be the main buyers for Ethiopia coffee, most of the recent contract registrations are of UG quality which has a Minimum Registration Price of 1.33 USD/lb, and is therefore cheaper that Brazil. The lower price reflects the poor quality, however these shipments will insure that new crop shipment starting 2nd quarter 2024 will not be mixed with current crop lower quality coffees. Some volumes of washed coffee remain unsold however price/quality matrix not working for most buyers.

Security remains stable at present, most of the country seems to be peaceful.

The PM halted any speculation that tensions with Eritrea have increased in recent weeks:

On a more positive note an Ethiopian scientist working in the US has been awarded the prestigious National Medal of Science by President Biden:

Birr 55.48 = USD 1

Have a good weekend

This week’s rally in NY helped a little business get concluded. However Minimum Registration Prices continue to limit business, additionally demand is muted, normally a 15 cent rally would induce a few contracts getting signed off, alas not this week.

Meanwhile focus is increasingly turning to the new crop which continues to come off the trees. Cropping is ongoing in Djimmah and Limu areas. Weather remains favourable and prices stable at between 20 and 25 Birr per kg of cherry.

On a different topic, inflation has been declining for 6 months. However, Black Market forex rates continue extremely high at approximately double the official rate.

Birr 55.42 = USD 1

Have a good weekend

Ethiopia coffee exports reported as 17 k MT bringing the 7 month March to September period to 160 k MT. We are currently 21 k MT below the 5 year average and given that this 23/24 March to Feb period should have been an up year the pace of shipments is very disappointing. We believe that the inventories are at elevated levels across the supply chain, and particularly high at farmer level as a consequence of prices having not met growers expectations. Furthermore, the Coffee & Tea Authority (C&TA) continues to maintain elevated Minimum Registration Prices, particularly for lower quality Grade 5 Naturals discouraging export sales to European markets.

Looking at the coming months we would normally expect shipment flow to decrease between Oct and Feb, given that weakness in the terminal market, poor quality of the coffee remaining in the country and general stubbornness of farmers and the C&TA we expect that exports will remain below potential. I would be surprised if the by the end of the 12 month period (Feb 24) shipments have reached 225 k MT.

Meanwhile harvesting and processing of the 23/24 crop continues, cherry prices remain below 25 Birr/kg (less than half the price paid last year) and given the lack of cash in the field we expect that they will remain contained. Limu areas will start to receive cherries second half October and the Southern regions will start in November.

As a big part of the export market is closed due to high minimum registration prices, local “mercato” coffee prices have decreased due to increased availability of coffee for local consumption. Additionally, crop quality is so poor that the proportion of undergrades is much higher.

Birr 55.35 = USD 1

Have a good weekend.

The Coffee and Tea Authority decreased Minimum Registration Prices by 3 cents, however Grade 5 FOB prices remain at a premium to NY. As a means of getting around this impediment to trade Under Grade (UG) sales are being registered at the current Min Reg Price of 133 c/lb.

New crop harvesting continues without any hiccups, weather remains favourable and prices much more in line with international market prices. The security situation in several regions of the country seems to have improved in recent weeks, this will greatly help farmers as the coffee harvest gathers pace. In Tepi the first samples will be available as early as next week.

In other news, a UN-backed inquiry into abuses committed in Ethiopia will end its work next week after member countries chose not to renew its mandate. Furthermore, the US Government resumed distributing much needed food aid, for more on this please follow the link:

Birr 55.28 = USD 1

Have a good weekend