A Source of Sustenance
Demand from China propels Ethiopia’s co'ee exports
It’s past 5 a.m. and Habib Mohammed is leaving his house to start the day at his 2.5-hectare coffee farm in the lush highlands of Ethiopia’s Oromia Region. In this East African country, Oromia is the natural homeland of the delicate Coffea arabica plant, which is driving an insatiable thirst for a beverage that has come to conquer the world. The Oromo people from this region are thought to have been the first to have noticed the stimulating effects of the coffee beans, and it remains an important element of their traditional cuisine.
“I wake up every morning with my wife to manage our farmland, which is our source of livelihood. After each coffee harvest, we sell our produce to a local farmers’ cooperative, which is enabling smallholder farmers like us to put food on the table and sustain our livelihood,” Mohammed told ChinAfrica.
As Ethiopia’s main export commodity, coffee contributes to the livelihoods of more than 15 million smallholder farmers and other stakeholders in the coffee sector. It is estimated that Ethiopia’s coffee production for 2022-2023 will reach over 495,000 tonnes.
Benefits of beans
Mohammed, 50, is excited that in the last farming season, he produced over 500 50-kg bags of arabica coffee beans - the most aromatic kind favoured by the majority of drinkers who prefer its rich, dark liquid.
For many people, it feels almost impossible to be productive without a cup of coffee. Even the traditionally tea-drinking countries like China are seduced by Ethiopia’s arabica coffee produce due to its charming flavour.
With about 5 million coffee growers in Ethiopia, the Ethiopian Coffee and Tea Authority (ECTA) has noted that more than 25 million people in the country depend on coffee production and processing for their livelihood.
Amid the high demand for arabica coffee in China, a growing number of Ethiopian coffee growers and exporters are vying to penetrate the emerging Chinese coffee market.
One of Ethiopia’s largest producers and exporters of co#ee - Kerchanshe Trading - expects China to become one of the main destinations for Ethiopian co#ee in the near future.
ECTA Director General Adugna Debela recently observed, “We are witnessing a growing coffee market in China and other parts of Asia. The increasing number of consumers and growing popularity of Ethiopia’s coffee among the Chinese people is encouraging.”
Emerging market
Like Mohammed, Gizat Worku is among Ethiopia’s smallholder coffee farmers propelling their country’s exports to China.
“We need the Chinese market very much because China is home to about one-sixth of the world’s population, and selling to that market means more benefit to us in terms of job creation, value addition and agriculture growth, among others. All we need is to satisfy the Chinese market demand for our coffee and meet their requirements,” said Worku, general manager of the Ethiopian Coffee Exporters Association, adding that the organisation has already agreed with some Chinese companies who are preparing to sign agreements with the local exporters.
Following the strategic cooperation framework agreement inked recently at the Ethiopian Embassy in Beijing, a number of Chinese companies have clinched deals to purchase Ethiopian coffee beans. Luckin, a Chinese coffee company and coffeehouse chain, is one of the firms that recently pledged to buy 2,000 tonnes of coffee annually.
In this context, Ethiopian Ambassador to China Teshome Toga Chanaka reiterated the importance of China’s e-commerce market when he recently promoted Ethiopian coffee on China’s e-commerce platform Taobao, where about 11,000 bags of coffee were sold in just five seconds.
“I think that holds the future, and that’s one area where we would like to cooperate with Chinese enterprises here in order for us to increase our exports to the Chinese market. We also need to work with Chinese companies so that productivity is increased in the agriculture sector, in value addition, in manufacturing and so forth,” Teshome said.
Ethiopia’s reputation as a producer of top-class specialty coffees in terms of aroma, organic nature and variety is of great advantage.
Gaining attention
At the Fifth China International Import Expo (CIIE) held in Shanghai in November 2022, Ethiopian coffee received a lot of attention with exporters keen to establish their roots in the Chinese market.
According to the ECTA, the East African country exported 11,935 tonnes of coffee to China during the last Ethiopian fiscal year (8 July 2021-7 July 2022) and earned over $65 million, up 84 percent year on year, which accounts for 30 percent of Ethiopia’s export revenue. That made China the seventh major importer of Ethiopian coffee during the last fiscal year, up from 33rd in the previous fiscal year (8 July 2020-7 July 2021). The top five export destinations were Germany, the US, Saudi Arabia, Belgium and Japan.
Wu Peng, director general of the Department of African Affairs at China’s Ministry of Foreign Affairs, recently affirmed that Ethiopia’s coffee exports to China saw an 84-percent growth in volume.
“Good to see an 84-percent increase in Ethiopian coffee exports to China this year (2022). With the Fifth CIIE opening in Shanghai on November 5, I hope to see more African quality products make their way to the Chinese market and bring benefits to Africa,” Wu wrote on twitter late last year.
Thanks to the booming Sino-Ethiopian trade and investment cooperation coupled with important platforms such as the CIIE, Ethiopia’s overall export to China has registered steady growth in recent years as China remains Ethiopia’s biggest trading partner.
Chinese official data show that Ethiopia’s exports to China increased by 8 percent in 2021 as compared with the previous year.
One of Ethiopia’s largest producers and exporters of coffee - Kerchanshe Trading - expects China to become one of the main destinations for Ethiopian coffee in the near future. “We are tripling our exports to China both in quantity and quality. The demand is high, and we are preparing to grow more coffee for the Chinese market,” Kerchanshe Trading Chief Executive Officer Israel Degefa said recently.
Ethiopian President Sahle-Work Zewde has since paid glowing tribute to all stakeholders in the country’s coffee industry value chain: “I am delighted to hear about the growth of production of coffee. Farmers, unions and exporters have been credited with the promising result. I would like to extend my appreciation to all of them engaged in this sector.”