The Ethiopian Coffee and Tea Authority (ECTA) has issued an urgent call to coffee suppliers and exporters to accelerate the sale of their inventory following a dramatic slump in international coffee prices.
In a statement released recently, the Authority warned that the sudden volatility in the global market poses a significant threat to the country’s foreign currency earnings and the profitability of local businesses. Consequently, stakeholders have been strictly advised to move their stocks to the central market and expedite shipments rather than holding onto products in anticipation of a price rebound that may not materialize soon.
The Director General of the Authority, Dr. Adugna Debela, revealed that global coffee prices have plummeted from $4.00 per pound (lb) to $2.80 per pound within the last two months alone. This represents a nearly 30% decline in market value. Market analysts predict that prices could slide further, potentially reaching as low as $2.50 per pound in the coming weeks.
Dr. Adugna emphasized that hoarding coffee in hopes of better prices is a high-risk gamble that could lead to devastating financial losses, urging exporters to seize current market opportunities before values dip further.
For the current fiscal year, Ethiopia has set ambitious targets for its “green gold” sector, aiming to produce 1.5 million metric tons of coffee. Out of this total production, the government plans to export 600,000 tons, with a revenue target of $3 billion. To achieve this milestone, the Authority is closely monitoring trade activities and encouraging suppliers to shift their focus from commercial-grade coffee to high-quality Specialty Coffee. Specialty coffee often commands premium prices and remains more resilient to global market fluctuations, making it a vital buffer for the national economy during times of price volatility.
In tandem with the market advisory, the Authority has announced a crackdown on illegal trade practices. According to national regulations, hoarding coffee for more than a year is a punishable offense as it deteriorates the quality of the beans and sabotages the country’s economic interests. Dr. Adugna warned that some traders have been found withholding products from the market or attempting to smuggle coffee across borders through contraband routes. He stated that such activities are detrimental to the nation’s foreign exchange reserves and that the government will take decisive legal and administrative actions, including the revocation of business licenses, against those involved in illicit trade.
Finally, as reported by the Ethiopian Press Agency (EPA), overcoming the current market challenges requires a synchronized effort between the government and the private sector. Exporters have been encouraged to maintain their market share in key destinations across Europe, Asia, and North America by ensuring a steady and rapid supply. This proactive approach is deemed essential not only for mitigating the impact of the global price drop but also for ensuring the long-term sustainability and competitiveness of Ethiopia’s coffee industry. All actors in the value chain are expected to align their operations with the current global economic reality to protect the livelihoods of millions of farmers and the stability of the national economy.