Recent Achievements in Ethiopian Coffee

Development and Lessons from Major Arabica

Producers

Third Annual Ethiopian Coffee Conference Nov. 6 - 7Addis Ababa

1. Introduction

2. Production & Productivity Achieved

in the GTP Period

3. Lessons from Major Arabica Coffee

Producing LA Countries

4. Conclusion

Outline

• Considered as one of the high priority crops in Rural Development Policy and Strategies of the Government

• Received inadequate attention in building consensus for realizing its full potential in line with the established priority directions

• Establishment of CTS Unit at MoA with a mandate

to reinforce coffee extension

• Evaluation of challenges and opportunities of the

sector

• Produced in collaboration with stakeholders

differen study docs

Introduction

Prodution & Productivity

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0

100

200

300

400

500

600

2009/10 2010/11 2011/12 2012/13 2013/14

Area (000ha)

Prodn (000 tone)

Productivity (k/ha)

GTP Performance (2010/11- 2013/14)

Hecta

res

Coffee Plantation

What has been done?

Building consensus on the necessity of strong

government support to revitalize the coffee

industry

Initiated a medium to long term strategy that

would critically analyze the major causes of

underachievement and come up with appropriate

recommendations

Formulation and implementation of Coffee

development strategy

CTS unit upgraded to directorate and

recruitment of additional manpower underway

Built consensus with major coffee producing

regions to pay due attention to the sector

What has …?

Creation of stakeholders platform/forum for

constructive dialog and alignment

Coffee productivity and quality enhancement detail

activities prepared and its implementation started

Massive hands-on capacity building trainings

conducted

Experts team from pertinent institutions assigned to

ensure strict adherence to Proclamation # 602/2008

and Council of Minister’s Regulation # 161/2009

Experiences

of Major Arabica Coffee Producing

Latin American Countries

Coffee Production In Brazil

• Coffee introduced to the country in 1727

• Entered into export by1820

• World largest producer and exporter since

1840 (7.8 billion USD in 2011),

• Grown on about 2.4 million ha mainly in Minas

Gerais, Espirito Santos, Sao Paulo, Rio de

Janeiro, Paraná, and Bahia

• 75 % Arabica & 25% Robusta

• Major economic and social progress registered

with earnings from coffee export

• High involvement of the government in

supporting & developing coffee production until

1990s (abolishment of IBC).

Coffee Growing Regions

Coffee Institutions

Government maintains control of coffee

production activities from growing up to

marketing of the final product

CDBC: Deliberative Council of Coffee Policy established

in 1996 with a responsibility of approving policies and

strategies for the sector

FUNCAFE: Coffee Economy Defense Fund (1985)

responsible for financing policies for the sectors various

production chain

Brazilian Consortium for Coffee Research and

Development

Composition of CDPC:

• Three members from MICT which holds the presidency

• One representative each from ministries of Agriculture,

Livestock & Supply, Treasury, External Relations, and

Budget, and

• Various associations with national dimensions (National

Coffee Council, National Confederation of Agriculture,

Coffee Industry Association, Federation of Coffee

Exporters, Soluble Coffee Industry Association)

With all members having equal voting rights

Institutions…

Institutions…

Major Mandates of CDPC

• Approving overall coffee strategy for production &

marketing

• Authorizing the implementation of research programs and

projects

• Approving annual budget for FUNCAFE

• Regulating activities of maintaining balance b/n export and

domestic consumption,

• Approve coffee stock and warehouse mgmt policies

• Establish technical & financial cooperation with public and

private bodies in the sector

• Approve coffee agri-business plans & institutional

marketing programs for export and domestic market

• Proposing to the National Monitory Council the amount of

contribution quota and approving the financial agent to

carry out the operations as provided for by the law

Brazil…

Brazil…

Brazil…

Brazil Coffee Productivity B

ags/h

a

Production Year

Source: ATO/Sao Paulo

Colombia

Production

• Introduced in 1732

• One of the main drivers of social & economic

development by 1830s

• Produced by 553 thousand households in 20

Departments & 588 municipalities on 0.9

million ha (95% smallholders)

• Source of livelihood for 4 million Colombians

• # 1 generator of income and welfare in rural

areas

• 16% of the agricultural GDP

• High quality and consistent supply,

• 25% sustainability certified or verified

Coffee Growing Areas

Cultivated Areas

588 Coffee-Growing

Production Systems

Traditional 30% Shade grown 37% Modern Open 33%

FNC Structure

Source: www.federaciondecafetros.org

Founding Members of FNC

Source: www.federaciondecafetros.org

Through its 15 Departmental and 364 Municipal Coffee Grower Committees:

• Purchase Guarantee: Buying coffee at 540 points of purchase close to its members & 36 coops based on quality & processing stage Quality control & warehousing for product

differentiation and support to guarantee the reputation of Colombian coffee and the generation of premiums for the coffee producers. &

Scientific research through Cenicafé on generation and dissemination of appropriate, competitive sustainable and problem solving technology and knowledge to increase productivity, competitiveness

Services to the Members

Services… Coffee extension focused on consolidating a

productive and competitive coffee growing

(quality, best practices and implementation of

business management programs…)

Capacity building on appropriate coffee

production, processing and marketing at its

special training center

Collection, compilation, and availing coffee

statistical data

Value addition to and promotion of Colombian

coffee (freeze-drying plant and a chain of Juan

Valdez Specialty coffee shops)

Establish constructive relations with government,

NGOs, International coffee associations &

roasters

• Promotion and positioning: Includes the

implementation of brand and marketing strategies

to create a higher demand and added value for the

producers, as well as actions to defend the origin

and positioning of

Colombian coffee as the best in the world.

• Investment in the social fabric: Permanent

programs and investments for the development of

the producers and the rural communities in the

coffee zones.

• Connectivity: Generate digital access and content

aimed at the producers.

Services…

FNC Logo

One of the world's largest agricultural non-

governmental organizations leading Colombian

Coffee Industry to a great success by integrating

economic, social, scientific, and marketing

programs

Member Organizations Cenicafe’ (1938)

National Coffee Fund (Fondo NaciÓnal del Café :1940)

Marine fleet (Flota Mercante Grancolombiana :1947)

Coffee bank (Bancafe’)

Coffee quality centers and warehouse (Almacafe’ )

Juan Valdez Promotion (1959) & Valdez® logo (1982)

Special Coffee Training Center (Manuel Mejia Foundation:1960)

Procafe’cole

Coffee Statistics፡ SICA

Foreign offices and shops

• Developed 12,000 aqueducts

• Built 19,000 class rooms

• 15,000 km new roads

• 500 hospitals and health centers

• Various bridges, residential houses, School

bathrooms, rural electrification

Infrastructures built (until 2012)

Visionary, capable, and skilled leaders

Stable leadership

Strong and reliable financial resource

Political independence

Focus on smallholder coffee growers’

interests

Building strong consensus among members in

protecting national interests

Secret of its Success

Guatemala

• Second largest coffee producer in Central America

• Grown on 270,000 ha by Ninety thousand growers

• Important figure in the Guatemalan Coffee Industry is ANACAFE as policy adviser to the government on coffee issues

…

What makes Unique?

• Strong Government Support

• 100 million USD trust fund authorized by the government for financial assistance to coffee farmers during crises

• Low interest loan for smallholder coffee farmers to apply for international certifications

• Extension service provided by ANACAFE, Government, and NGOs

Important Lessons

Coffee industry actors are its sole

owners and can make a difference if united

Strong associations are crucial for sustained

coffee sector development

Sharing and proper use of experiences of

successful coffee growing countries

Adoption and scaling up of appropriate coffee

growing and processing, and marketing

technologies is key for competitiveness

Government’s role is expected to diminish

through time

Conclusion

As important actors in the coffee sector, public

and private sector should build a strong

partnership to reflect same position and

collaborate in promoting the coffee sector

There is a need to align efforts to build the

required capacity in both sides

Industry associations/federations with a

primary focus on the small producers should

be in place

Thank You