The U.S. government has shown an interest again in the coffee industry in Ethiopia. The United States Agency for International Development (USAID) has announced that it will support and help increase the quality, marketing, and traceability of coffee and assist more farmer cooperatives. The USAID’s Agricultural Growth Program – Agricultural Market Development Project will now collaborate with Ethiopia Commodities Exchange (ECX) to help improve the ability of sellers and buyers track coffee origins through an electronic coding and marking system. They will also help certify labs and coffee graders, increase the number of farmer cooperatives, and support the improvement of ECX warehouses. The hopes are that these efforts will improve the integrity and marketability of the coffee trading system in Ethiopia.
Here’s some more information from USAID on the subject:
ECX, the first modern market in Ethiopia, commenced trading operation in April 2008, with contracts traded in coffee, sesame, maize, wheat, and pea beans. ECX is a market place where buyers and sellers come together to trade based on warehouse receipts, assured quality, delivery and payments. It is a national multi-commodity exchange that provides market integrity, enhances market efficiency, ensures market transparency and allows risk management.
The United States was among the first donors who supported the establishment of ECX. USAID funded four technical advisors and supported the coffee Direct Specialty Trade (DST) linking smallholder farmers with international buyers, warehouse equipment, and the Warehouse Receipt System (WRS).
“We are extremely happy to see the renewal of our cooperation with the Ethiopia Commodities Exchange,” says Mr. Dennis Weller, Mission Director, USAID Ethiopia. “We believe in the ECX mission to be a structured trading platform for buyers and sellers that addresses the fundamentals of commodity transactions: quality, quantity, payment and delivery.”
“This MoU demonstrates our commitment to enable smallholder farmers to reap the benefits of their produce by enhancing their direct participation in ECX’s trading system”, said ECX CEO Anteneh Assefa. “ECX is undertaking various efforts to grow the number of full member farmers’ cooperatives from the current number of 15. This is only one of many improvements to come with the support of this partnership.”