Ethiopia's coffee export volume has declined due to multiple factors!

Source:Best Coffee > News Author:qjroot Published:2024-07-07 18:52:16

It is reported that the Ethiopian coffee industry is currently facing severe export problems. Ethiopia has long been a landlocked country, so Ethiopian coffee exports have mainly relied on the Port of Djibouti in neighboring Djibouti.

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However, because this port is located between the Red Sea and the Gulf of Aden, it has been deeply affected by the Red Sea crisis. After the crisis broke out in the Red Sea, global shipping giants all decided to reroute their vessels around the Cape of Good Hope, resulting in fewer ships now docking at the Port of Djibouti.

Moreover, the Red Sea situation has shown a trend of escalation in recent times. In early May, the Houthi armed group issued a new statement, saying it would expand its strike range to target all ships trading with Israel in the Red Sea, the Arabian Sea, the Indian Ocean and the Mediterranean, regardless of the ships' nationality or the location of their destination ports.

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This statement may lead shipping companies to choose routes that bypass the region, or to stop shipping on those routes. This has severely affected Ethiopia's coffee exports. It is reported that, due to the reduction in ships, quite a lot of coffee beans are currently stranded at the Port of Djibouti because there are no vessels to export them.

To solve this problem, the Ethiopian government can only choose other ports for exports. For this reason, the Ethiopian government chose neighboring Somalia. Earlier, Ethiopia signed a memorandum of understanding with the local government of Somaliland in northern Somalia, recognizing Somaliland as an independent state in exchange for the right to use the Port of Berbera.

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However, since the memorandum of understanding was signed in January, there has not been much progress, as the Somali government believes the agreement infringes on its sovereignty, leading to an escalation of regional tensions. As a result, Ethiopia still cannot use the Port of Berbera mentioned in the agreement, and because relations with Somalia have deteriorated over this incident, it cannot use other Somali ports either, affecting Ethiopia's coffee exports.

However, recently the Turkish Ministry of Foreign Affairs said it had received diplomats from Ethiopia and Somalia, and the three parties signed a joint statement after candid, friendly and forward-looking talks on their differences. Another round of talks was also held in Ankara on September 2. The ministers of Somalia and Ethiopia reaffirmed their commitment to resolving differences peacefully.

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In addition, according to analysis by local Ethiopian exporters, other neighboring countries such as Eritrea and Sudan both have ports, but because they are located in the Red Sea region, they are still affected by the Red Sea crisis. Kenya's Port of Mombasa is located at the southern end of Kenya, and traveling there from Ethiopia requires crossing the entire country of Kenya, a long journey that likewise increases export time and costs.

According to data from the Ethiopian Coffee and Tea Authority, in the first 10 months up to May this year, Ethiopia exported a total of 209,000 tons of coffee, with export revenue exceeding 1 billion US dollars, but both were lower than last year's same-period figures of 290,000 tons and 1.7 billion US dollars.

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Moreover, in recent times, Ethiopia has been in a state of internal conflict, with multiple incidents of kidnapping and conflict occurring in Addis Ababa, the capital of Ethiopia, and in areas outside the south of the country. As a result, in recent times coffee traders and bean hunters have reduced or stopped traveling to the country and begun to turn their attention to other coffee-producing countries in Africa, which is not conducive to the development of Ethiopia's coffee industry and affects the influence of Ethiopian coffee in the international market.


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