Focus on 20/21 review and 21/22 prospects

We have been working on our yearly review of the season (20/21) and outlook for the next (21/22) crop. Below we have highlighted our main points.

20/21 Crop review Comments:

1. Record Monthly Exports since March 2021! Indeed March 2021 to October 2021 (8 months) stand at 235 K MT which opens the possibility to have shipments for the 12 month period March 21 to Feb 22 totalling 5 M bags. The jury is still out, but with only 4 months to go it is looking very possible.

• There has been a shift in the Disappearance from Domestic Use (Internal Consumption + Unofficial exports) to Exports
• Political Instability in Ethiopia (and neighbouring countries) did not hamper exports as much as would be expected. Logistics have been difficult due to: a) lack of containers (reduced in number by lower imports and a global imbalance) and b) vessel scheduling nightmare
• High international coffee prices have acted as a magnet for Ethiopian coffee drawing coffee away from the Domestic Market to Markets overseas

21/22 Crop Expectations:

1. The crop is expected higher than the 20/21 crop by 7%
2. Weather during harvesting has favoured quality.
3. Exports are likely to remain at elevated levels; 5 M bags between March 22 and Feb 23?
4. There will be a higher proportion of Naturals vs Washed because the crop in West and South West is where the increase in production in bigger and these regions produce more Naturals than Washed; it appears that there is less cash available at farm gate level to purchase red cherry for washed processing, after all the price for cherry has doubled between 2020 and 2021!

Following on from last week’s reports of military victories by Government forces, this week there have not been scant reports on the fighting between TPLF and Government forces.

Birr 48.32 = USD 1

Have a good weekend