Ethiopian Coffee Exports Recover But Prices Fall

Ethiopia’s coffee sector showed strong export performance in the first half of the 2014/15 fiscal year—but rising shipments didn’t protect farmers from tumbling global prices. The world’s fifth-largest coffee producer faced a sharp decline in international coffee values just months after seeing improved revenues, raising concerns over long-term stability for its growers.

In H1 2014/15 (July–December 2014), Ethiopia exported 73,227 tons of coffee, generating $30.75 million in revenue—99.5% of the volume target and 114.3% of the income goal. Yet by early 2015, prices began falling fast, and the industry now faces a challenging outlook.

Export Performance Met Most Targets

The country aimed to export 235,950 tons of coffee in the full 2014/15 fiscal year, with projected total revenue of $86.25 million. In the first six months, it reached 99.5% of the planned export volume (73,227 tons out of an expected ~73,600 tons), and 114.3% of the expected revenue for that period ($30.75 million versus a target likely around $26.8 million). These figures suggest solid export execution despite later price challenges.

Price Recovery Then Sharp Decline

The improved H1 revenue was driven by a temporary rebound in export coffee prices. However, starting in January 2015, international coffee prices began to fall sharply. By early February, the price had dropped to 163.6 cents per pound, and by early March, it hit just 137.6 cents per pound. The Ethiopian Ministry of Industry forecasted that prices could fall further, potentially reaching 120 cents per pound. This downward trend raised alarms across the supply chain.

What Determines Global Coffee Prices?

Contrary to common assumptions, international coffee prices are not solely determined by supply and demand fundamentals. According to the report, political factors and other external variables play a significant role in shaping the market. This volatility makes it difficult for producing countries like Ethiopia to rely on consistent income, even when export volumes are stable or increasing.

Ethiopia’s Position in Global Coffee Production

Ethiopia is the world’s fifth-largest coffee producer, contributing 4.5% of the global coffee supply. The top four producers are Brazil (34.5%), Indonesia (8.75%), Vietnam (7.99%), and Colombia (7.17%). Despite its smaller output compared to these giants, Ethiopia remains a critical origin for specialty coffee due to its unique growing conditions and diverse genetic resources.

Frequently Asked Questions

How much coffee did Ethiopia export in H1 2014/15?

Ethiopia exported 73,227 tons of coffee between July and December 2014, which was 99.5% of its planned export volume for that period.

What was the coffee export revenue in H1 2014/15?

The total coffee export revenue in the first half of the 2014/15 fiscal year was $30.75 million, achieving 114.3% of the income target for that period.

Why did coffee prices fall in early 2015?

International coffee prices started declining in January 2015, dropping to 163.6 cents per pound in early February and 137.6 cents per pound in early March. The Ethiopian Ministry of Industry predicted a further fall to around 120 cents per pound.

Are coffee prices mainly set by supply and demand?

No. According to the report, global coffee prices are influenced more by political and other external factors than by simple supply and demand dynamics.

What rank is Ethiopia in global coffee production?

Ethiopia is the fifth-largest coffee producer in the world, accounting for 4.5% of global supply. The top four are Brazil, Indonesia, Vietnam, and Colombia.

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