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.