Ethiopian Entrepreneur Pilots Unified Agricultural Market Platform Frustrated by Middlemen

A four-month-old platform developed by coffee industry insiders looks to automate Ethiopia’s agricultural export supply chain through a unified market interface. Ethiopia-exports.com is piloting a portal where industry players can access a long list of commodities, trace their source, and verify their quality before conducting a transaction.

Biruk Asegid, Founder of Ethiopia-exports, says Ethiopia’s agricultural export supply chain is rife with middlemen who add little value and only serve to distort genuine free market operations. He believes that equipping industry players with real-time information on prices and supply of commodities will foster competition and enhance exports.

“The platform was birthed from our own frustrations,” Biruk told Shega.

Just a few months back the founder recalls getting into a fierce price-cutting battle on a shipment of coffee as middlemen fueled speculation about the size of the delivery. He recalls being amazed at how another exporter was ready to sell at a loss all because of misinformation in the market. While in its early stages, the Platform is averaging 2,000 weekly visits and has conducted 10 successful transactions, according to Biruk.

“We expect visitors to increase to 20,000 when we start sharing live price updates,” he says.

Ethiopia’s export performance is at a historic high following the adoption of a market-based exchange rate policy in July and a host of fortuitous circumstances in international markets. Coffee prices surged to a five-decade high of 3.30 dollars per pound allowing Ethiopia to earn a historic 908 million dollars in six months from 200,000 tons. Minas Gerais, an area in Southern Brazil responsible for much of the global Arabica production, experienced a 30% drop in yield giving Ethiopia a competitive edge. At the same time, Ethiopian authorities have allowed an increasing amount of produce to be exported outside of the Commodity Exchange granting exporters significant flexibility.

Girma Amente (PhD), Minister of Agriculture, recently told parliamentarians that nearly 90% of Ethiopia’s coffee had been exported through vertical integration in the current year. 

Biruk believes this shift towards vertical integration, as the authorities refer to it, could be indicative of an overall transition towards more commercially oriented approaches. He hopes to see elements of the coffee export process like harvesting, processing, and milling fall more into private sector hands.

“Free market principles are the best way to benefit all industry players,” Biruk says.

The Platform has received interest from around one hundred exporters and several foreign buyers in the few months it has been live. The Founder hopes to penetrate the European commodity markets which he feels Ethiopia is losing out to Southeast Asia countries. He expects a unified marketplace for agricultural output to give international buyers confidence in the source of the products and their quality.

“We can meet compliance and quantity standards,” Biruk says” But we must start somewhere.”