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Ethiopia Export Revenue Falls as Top-Earning Coffee Prices Drop

Ethiopia Export Revenue Falls as Top-Earning Coffee Prices Drop
 
By William Davison – Jul 26, 2013
The value of exports from Ethiopia, Africa’s biggest grower of coffee, fell 2 percent in 2012-13 from a year earlier as a result of declining prices for the beans even as volumes increased, the Trade Ministry said.

Ethiopia’s exports declined to $3.08 billion in the 12 months through July 7 from $3.15 billion a year earlier, the Addis Ababa-based ministry said in an e-mailed statement.

The Horn of African nation’s $43 billion economy is forecast to expand 6.5 percent this year, faster than the average of 5.6 percent for sub-Saharan Africa, according to the International Monetary Fund.

Revenue from coffee exports declined to $746.4 million in 2012-13 from $832.9 million, while volumes jumped 18 percent to 199,104 metric tons, the ministry said. Arabica coffee prices dropped 31 percent in the period, according to data compiled by Bloomberg. The price rose 2.9 percent to $1.2480 per pound by the close in New York yesterday.

Gold, the country’s second-biggest source of export revenues, fetched $578.8 million, falling 4 percent from a year earlier. Earnings from other minerals, excluding tantalum, jumped 48 percent to $12.4 million, while sales abroad of khat, a leafy plant that is used as a mild stimulant, raised $271.5 million, an increase of 13 percent, the ministry said.

Ethiopian exports have a limited impact on the overall economy, which is mainly spurred by public investment and private consumption, Lars Christian Moller, the World Bank’s lead economist in the country, said by phone today from Addis Ababa, the capital.

“The ambition is to have export-driven growth but Ethiopia needs to make further progress on improving competitiveness to realize this,” Moller said.

Shipments of leather products increased 10 percent to $121.9 million in the period as textiles rose 16 percent to $97.9 million, the ministry said. Deliveries of oil seeds fell 6 percent to $440.9 million, while exports of pulses surged 46 percent to $233.3 million, the ministry said.

Source: Bloomberg 

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