With the crop coming off trees in ernest, old crop is moving out of shippers warehouses and on to vessels at a steady pace and with an increased sense of urgency. Of course the recent upward movement in NY has also helped selling. We expect that November shipments will be steady following on from October exports which were an improvement on previous months’ shipments.

The harvest is approaching it’s peak now, all coffee growing regions are harvesting and so far we have no quality concerns. There is less cash in the field for cherry buying than in previous years which will limit the proportion of Washed Coffee, however the price remains well below last year’s price so export prices will not be under the same pressure as last season. In guji prices are now between 35 and 40 Birr/kg Cherry.

Weather continues favourable for ripening of the crop with intermittent wet and dry periods.

The BBC has report on a cholera outbreak in the east of the country following floods: https://www.bbc.com/news/world/africa?ns_mchannel=social&ns_source=twitter&ns_campaign=bbc_live&ns_linkname=656862cb6868a4009ac43095%26Ethiopia%20cholera%20outbreak%20kills%2023%262023-11-30T10%3A56%3A13.317Z&ns_fee=0&pinned_post_locator=urn:asset:3aad4f18-02eb-45a8-adc1-0cc91a6b9f1f&pinned_post_asset_id=656862cb6868a4009ac43095&pinned_post_type=share

Birr 55.70 = USD 1

Have a good weekend!

The Coffee & Tea Authority has started registrations for New Crop 23/24 at prices that have substantial premiums to current 22/23 crop Minimum Registration Prices. Grade 2 23/24 premiums over current crop at between 20 and 25 usc/lb, whereas Grade 5 premiums are a more modest 10 usc/lb. However, given fledgling NY terminal market prices, we expect that New Crop registrations will be paralysed for now, no one is going to rush to pay +50 for Limu 2 and +100 for Sidamo/Yirgacheffe 2.

Harvest in progressing well, lower areas in the South (Sidamo) have started harvesting, prices paid for ripe cherries remain under control. Wetter than usual weather is not hampering harvesting activities so far.

Inflation in October had an uptick, increasing 1% from 28.2 to 29.2 %. This was the first time in 7 months that inflation has gone up. Although the rate is higher it seems to be fairly stable, the Government seems to have a handle on things!

Talks between the Government and the rebel group Oromia Liberation Army (OLA) have broken down: https://www.bbc.com/news/live/world-africa-67176426?ns_mchannel=social&ns_source=twitter&ns_campaign=bbc_live&ns_linkname=655d84af2ea49e2bc009bc58%26Ethiopia%20talks%20with%20rebel%20group%20OLA%20end%20without%20deal%262023-11-22T06%3A03%3A36.222Z&ns_fee=0&pinned_post_locator=urn:asset:4117bc81-712c-4e15-8735-1f359d0847dc&pinned_post_asset_id=655d84af2ea49e2bc009bc58&pinned_post_type=share

The BBc also reported this week on the misery that internal conflict is causing in the North of the country: https://www.bbc.com/news/world-africa-67505676

In other news, an Ethiopian artist has broken her own record for the highest paid work of art made by an African artist at an auction in NY, the BBc reports: https://www.bbc.com/news/world-africa-67437955

Birr 55.65 = USD 1

Have a good weekend.

Exports for October topped 20 K MT; Shippers started “throwing in the towel” under pressure from Coffee & Tea Authority penalties, seeing the New Crop on the trees ready to be picked and steady prices. November shipments should continue this recent improved performance aided by the recent buoyant NY terminal market which as come just in time to help clear warehouses waiting to receive New Crop coffee. These strong October shipment figures followed on from very robust September shipments, however 22/23 exports are lagging behind expectations and even if the coming months register above average shipments by the time New Crop coffees come to market (March 2024) shipments will still be lower than expected.

Washing stations in the South have started receiving cherries, prices are 25 Birr/kg. It really seems that thus far stakeholders have taken heed of last years pricing chaos and have become much more disciplined (last year cherry prices in the South were between twice and 3 times current prices). There is also much less cash available in the field for cherry buying, leading to less competition which in the past has fueled pricing hikes.

Currently there is not much interest for new crop offers, it appears that roasters are waiting for lower prices and/or clarity on demand. Trade buyers are put off by the lack of carry in the market and high (even if stable) interest rates.

In other news, one year on from the peace deal between Tigray rebels and the Government, the BBC reports on the situation in the North of the country: https://www.bbc.com/news/av/world-africa-67290495

Birr 55.63 = USD 1

Have a good weekend.

The higher terminal market and lower minimum registration prices coupled with rather firm Natural differentials from other origins allowed for a little more business to get done this week compared to previous weeks. However, quality has to be very carefully checked and only small volumes are available as we are at the tail end of the 22/23 marketing season.

Regarding the 23/24 crop the outlook remains positive, good rains followed by days of sunshine are ideal weather conditions for the ripening of the crop. Harvesting in Sidamo, Guji and Yirgacheffe is imminent. Cherry prices remain between 25 and 30 Birr/kg cherry. Liquidity concerns are ongoing, financing this crop has not been easy and is unlikely to get any easier as banks are reluctant to advance cash having had their fingers burnt last crop. We remain extremely optimistic that quality concerns surrounding last crop 22/23 will not repeat themselves this time round.

Fighting in Amhara returns to the region, for more please follow the link: https://www.bbc.com/news/world/africa?ns_mchannel=social&ns_source=twitter&ns_campaign=bbc_live&ns_linkname=6548a7032ea49e2bc0099d81%26Fighting%20intensifies%20in%20Ethiopia%27s%20Amhara%20amid%20blackout%262023-11-06T09%3A15%3A12.881Z&ns_fee=0&pinned_post_locator=urn:asset:eea4423c-a80a-4700-83cf-3ad263915126&pinned_post_asset_id=6548a7032ea49e2bc0099d81&pinned_post_type=share

The Prime Minister stoked tensions with Eritrea with comments regarding the problems that Ethiopia faces due to being a landlocked country since Eritrea succeeded in the 90’s. For the BBC’s take on this story please follow the link: https://www.bbc.com/news/world-africa-67332811

Birr 55.60 = USD 1

Have a good weekend.