The Ethiopian coffee industry has been going through some changes in the past 6 months or so. We will attempt to explain and demystify some of these regulatory changes. The changes are still evolving and will most certainly take additional time to finalize. However, given the importance of Ethiopia to specialty coffee buyers across the world as well as the fact that the shipment period is upon us, we thought it important to take a deeper look at the changes and how it might impact purchasing in the future.
Ever since the creation of the Ethiopian Commodity Exchange (ECX) in 2008, buyers of specialty coffee have been mostly limited to two options. Option one: purchasing either non-traceable coffee from private exporters. Option 2: choose from a limited supply of traceable coffee from cooperative unions or a few larger farms. This created disincentives for farmers to produce the highest quality lots. Average quality instead became only as good as needed for a given ECX auction grade. Over the years, ECX suppliers gradually became good at unofficial ways of tracing their coffees through the system, but true traceability was rare and difficult. The country’s export earnings suffered. In a country where coffee consistently is one of the highest value exports, this was no small thing.
Revitalizing the Ethiopian coffee sector: guiding principles
In 2017, the Ethiopian Coffee and Tea Authority convened a group to draft a new set of principles and regulations for the coffee sector. The guiding principles were designed with the goal of revitalizing the coffee sector and its ability to generate increasing amounts of export earnings. Key principles included:
- Improving traceability in the ECX
- Improving overall quality
- Allowing for vertical integration between farmers, suppliers, and exporters
- Reducing the amount of “illegitimate” exporters
- Increasing the gross amount of export earnings
What about the implementation?
The initial statement of principles was approved in a proclamation of parliament at the end of last year. However, much hard work still remains to be done in the form of writing the specific regulations and processes. This has not yet been completed. In the meantime, there is a bit of a scramble as farmers align themselves with suppliers, suppliers with exporters, and exporters with buyers. There are many “grey areas”, but we are focused on the following principles in our Ethiopia purchasing:
We insist upon:
- Traceability to the washing station and local farmers
- Transparency of prices paid to farmers
- Trust in the quality-orientation of our export partners
We will always have a range of coffees on our offer list with a varying degree of traceability. There will be classic regional coffees like Sidamo and Limu. We will have more specific regional coffees, cooperative coffees, washing station coffees and estate coffees. Thanks to a strong exporting partner, we have access to great qualities and the guarantee of correct practices all along the chain.
This year, we will ship the first part of our coffees from Ethiopia in April. Get ready for fresh coffees from Adado, Nano Challa and Biftu Gudina as well as new coffees from Wolichu Wachu!