World, Economy, Africa

Ethiopia: Coffee industry sees steady growth

Coffee exports to increase 45 percent on government incentives and support, Trade Ministry official says

04.01.2016
Ethiopia: Coffee industry sees steady growth

Addis Ababa

by Tesfa Mogessie

ADDIS ABABA

Ethiopia's coffee exports are increasing, thanks in part to government incentives, a Trade Ministry official told Anadolu Agency on Sunday.

Coffee exports totaled 184,000 tons in 2014, and were worth $780 million, Shimelis Arega told Anadolu Agency.

“And coffee exports will increase 45 percent to over 260,000 tons this year,” he said. “Incentives will help achieve this goal, and they will include marketing linkage, loans for coffee exporters and processors, and the promotion of the Arabica coffee that the country exports at trade shows abroad.”

Coffee exports account for nearly 30 percent of the country’s hard-currency earnings, according to ministry figures.

“We are helping companies to expand coffee farms and to modernize processing,” Arega added.

The government will also take steps to crack down on the illegal coffee trade, he said.

“The ministry is training smallholder coffee farmers in improved harvesting, storage and preservation,” Arega pointed out, adding that these techniques add value to the coffee which then earns more in export sales.

The largest export destinations are Germany and Saudi Arabia. “Ethiopian exporters have 18 percent of the German market, and 16 percent of the Saudi Arabian market,” Arega said.  

 The Ethiopian Coffee Growers and Exporters Association members have holdings covering over 80,000 hectares (800,000,000 square meters), according to Association General Manager Yilma Gebrekidan. 

“The association has 200 members, and each owns 30 hectares of coffee farms. They exported 14,000 tons of coffee worth $70 million in 2014,” he said.

He said that association planned to increase the value of its exports to well over $ 100 million in the coming years, with government support as part of the Second Growth and Transformation Plan (GTPII), a five year economic plan beginning 2016.

The association is expanding farms, using promotions,  and is helped by incentives including tax exemptions for investors who import goods for coffee processing.

According to the association, the overall area covered by coffee farms in Ethiopia is about 800,000 hectares (8,000,000,000 square meters) of land with an annual production capacity of 500,000 tons. Coffee farms account for 25 percent of the workforce in Ethiopia. 

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