After a delay of a few weeks the Sidamo Referendum was held on Wednesday, 2.2 Million registered voters cast their ballot to decide if the Sidamo area should become an independent region; it is expected that the results will show that Ethiopia is on the path to add a new region to the already existing 9 autonomous regions that make up the country. The ballot was largely peaceful with many people waiting in line for many hours to cast their vote. Official results are expected in a few days’ time. There are other Ethnic groups that are also seeking recognition in other regions so the challenge for the prime minister will be how to appear to be dealing fairly with all these demands without unleashing tension, that could lead to violence as seen in the recent past. All this is happening 6 months before a General Election, a period when pent up frustrations come to the fore; on a more positive note if the May electoral process emulates what happened on Wednesday the Elections will be a success.
Drier weather this week helping the harvest, bringing on cherry ripening and allowing for coffee to dry once picked and processed.
Cherry Prices seem to be on the up we have reports of prices up to 16 Birr in Sidamo and 18 in Guji; In Yirgacheffe prices are as high as 20 Birr. It seems that if the drier weather continues in the South there will be a flood of cherries to the washing stations, however shippers are concerned that a higher percentage of the crop ill become Naturals rather than Washed coffees; let’s see what happens in the coming weeks. Some fresh coffees from Keffa and Limu have started to appears at the ECX. Also of note is the improvement in Natural quality offered at the ECX in the last 2 or 3 weeks, which has allowed shippers to acquire better quality coffee to fulfil their current commitments. We expect the flow of current crop Naturals to ECX to continue as middlemen need to start focusing on the new crop.
As we have discussed the Ethiopian Coffee & Tea Authority aims to more closely align ECX prices to FOB Djibouti prices, in this regard a minimum price will be set and revised every 15 days, whereby exporters have to register sales at a price above the set minimum price. A further proposal is to punish those that do not follow the regulations, if exporters register a sale below the minimum price by more than 5%, the exporter will, in the first instance, be fined; a second infringement will result in a further penalty and disqualification to register any further contracts at NBE or to purchase coffee from the ECX. Discussions on this regulation are ongoing, we are expecting more news in the next few days.
by Charles Seara Cardoso