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Coffee roaster joins export market amid exporter’s revoked licenses

A newly established coffee roasting firm which aims to export a value added and processed coffee, is about to export its first batch of roasted coffees with an immediate entry to Chinese and South African markets.

Solomon Kassa, co-owner and operations director of Melange Coffee Roasters told The Reporter that, the company has a daily capacity of roasting 7,500 kilograms and a packaging capacity of 3,600 kilograms of coffee per hour. Solomon also said that Melange Roasters has secured a 1,000 ton contract for one year. Solomon said that the plan was to launch export operations past May but delays of bringing processing machines have pushed targets to next month.

According to Solomon, his firm has invested close to 40 million birr and has created 40 jobs so far. Out of the 40 million birr outlay, 22 million was set aside to purchase roasting and packaging machineries. The remaining investment was injected for installations and groundwork’s along with working capital requirements.

Located in Addis Ababa, around Megenagna area, the roasting firm is said to market roasted and grounded coffees for both the local and international markets.

When asked about the export markets challenges, Solomon downplayed long established complaints many coffee traders have towards the international market, saying ‘appetite for Ethiopia’s processed coffee is marginal.’ However, Solomon counters this by stating there is a huge demand for value added coffee from Ethiopia. The supply sides constraints have for long neglected the potentials of the local demand for value added coffees that could have helped take the leap to the global roasted coffee market.

While very few are joining Melange Roasters, many coffee bean exporters are having a hard time with regards to trade prices (mostly linked with under-invoicing and over-invoicing) and contract breaches. According to Shafi Omer, deputy director of the Ethiopian Coffee and Tea Authority recently stated that 260 exporters have received warnings from the National Bank of Ethiopia (NBE). Accordingly, 81 traders have been called to report immediately in relation to claims of contracts defaults. The deputy director said that the authority has revoked trade licenses of 26 exporters and threatened to take sterner measures against non-contract abiding coffee traders.

The concluded budget year has seen a USD quarter billion deficit landing on USD 760 million in revenue, against the targeted USD one billion. However, the export volume was 230,000 tons of grain coffee, getting closer to the target.