Coffee review

Ethiopia's coffee exports have been reduced due to many impacts!

Published: 2024-07-21 Author:
Last Updated: 2024/07/21, According to reports, the Ethiopian coffee industry is currently facing severe export problems. Since Ethiopia is a landlocked country, Ethiopia's coffee exports mainly rely on the port of Djibouti in neighboring Djibouti. However, since the port is located between the Red Sea and the Gulf of Aden, it was deeply affected by the Red Sea crisis,

It is reported that Ethiopia's coffee industry is facing serious export problems. For a long time, since Ethiopia is a landlocked country, Ethiopian coffee exports mainly rely on the port of Djibouti in neighbouring Djibouti.

However, because the port is located between the Red Sea and the Gulf of Aden, it is deeply affected by the Red Sea crisis, and after the outbreak of the Red Sea crisis, the global shipping giants have decided to make a detour to the Cape of good Hope, resulting in fewer ships calling at the port of Djibouti.

And the situation in the Red Sea has been escalating recently. in early May, the Houthi issued a new statement to expand the scope of the attack, such as the Red Sea, the Arabian Sea, the Indian Ocean and the Mediterranean Sea to crack down on all ships dealing with Israel, regardless of their nationality and where the target port is.

The statement could lead shipping companies to choose to bypass routes in the area or stop shipping on that route. This has seriously affected the export of Ethiopian coffee and it is reported that many coffee beans are currently stranded in the port of Djibouti because there are no vessels for export.

In order to solve this problem, the Ethiopian government can only choose other ports for export, and to this end, the Ethiopian government has chosen neighboring Somalia. Earlier, Ethiopia signed a memorandum of understanding with the local government of Somaliland in northern Somalia to recognize Somaliland as an independent state in exchange for the right to use the port of Berbera.

However, little progress has been made since the signing of the memorandum of understanding in January, as the Somali Government believes that the agreement violates its sovereignty and escalates the situation in the region. As a result, Ethiopia is still unable to use the agreed port of Berbera, and the deterioration of relations with the Somali State has led to the inability to use other Somali ports, affecting Ethiopia's coffee exports.

Recently, however, the Turkish Foreign Ministry said it had hosted diplomats from Ethiopia and Somalia, and the three sides signed a joint statement after frank, friendly and forward-looking talks on their differences. And held another round of talks in Ankara on September 2. The ministers of Somalia and Ethiopia reaffirmed their commitment to resolve their differences peacefully.

In addition, according to the analysis of local Ethiopian exporters, other neighbouring countries, such as Eritrea and Sudan, have ports, but they are still affected by the Red Sea crisis because of their location in the Red Sea region. The port of Mombasa in Kenya is located at the southern tip of Kenya, and it used to be a long way across Kenya from Ethiopia, which also increases the time and cost of export.

According to data from the Ethiopian Coffee and Tea Administration, in the first 10 months to May this year, Ethiopia exported 209000 tons of coffee, with export revenue exceeding 1 billion US dollars, but decreased compared with 290000 tons and 1.7 billion US dollars in the same period last year.

Moreover, recently, Ethiopia has been in a situation of internal conflict, with a number of kidnappings, conflicts and other incidents taking place in the Ethiopian capital Addis Ababa and areas outside the south of the country. Therefore, recently, coffee traders and bean hunters have reduced or stopped going to the country and began to focus on other coffee-producing countries in Africa, which is not conducive to the development of Ethiopian coffee industry. affect the influence of Ethiopian coffee in the international market.