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The ECX, transparency and traceability.

    Home Home Blog Klassroom The ECX, transparency and traceability.
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    The ECX, transparency and traceability.

    By Gary Sawyer | Klassroom | Comments are Closed | 5 July, 2019 | 0

    Ethiopia: The birthplace of coffee, and ultimately the country responsible for the dissemination of Arabica coffee all over the world, that we drink on a daily basis. Ethiopia is the only country where Arabica coffee is an indigenous species. Its heirloom varieties offer some of the most unique flavours, and it is the biggest exporter of Arabica coffee in Africa. Not only is coffee vital to the Ethiopian economy, it is a major part of ritual and the daily life in Ethiopia. In recent years, as much as half of all Ethiopian coffee produced is for internal consumption, which rates them as one of the bigger consumers of coffee when compared with other producing countries.

    One of the main challenges Ethiopia faces when it comes to exporting coffee is traceability. In 2008 the Ethiopian government created the Ethiopian Commodity Exchange (ECX), in an effort to establish and better communicate baseline prices for coffee and other commodities. With a majority of Ethiopia’s coffee coming from small family-type farms, often living in remote communities, communication and information can be hard to come by. With little infrastructure in these remote areas, coffee is often sold to middlemen, and the potential for farmers to be underpaid for their efforts was high. By adding clarity to the value of coffee from different regions, it is more likely for farmers to receive fair pay for their crop.

    This sounds great, and at the time, no doubt was a very valuable change to Ethiopian communities growing coffee. Unfortunately, with the success of the commoditisation of coffee comes some negatives for today’s specialty coffee market. When coffee enters the ECX, it goes through a sorting process. Coffee is defined by its region, processing method, and also has a quality grading. This means that all coffee from the same region and processing method, with a similar quality, gets sold as the same thing. This is good for creating coffees with uniform ‘regional’ characteristics, but a disservice to farmers and mills working hard to create exceptional, unique coffees. In this situation, the ECX actually limits the potential amount a coffee farmer can earn producing something truly special.

    Luckily, the Ethiopian Government has in recent years redefined who can export coffee, in an effort to allow smaller producers to export without going through the ECX. With a specialty coffee industry keen to purchase coffee from unique microclimates, and also keen on establishing long term relationships, this has been an important step in the continued success for coffee in Ethiopia. It has allowed exporters to further separate out unique and interesting lots, with the intention of earning more for the coffee, but also providing traceability for the roaster. The roaster can share with their customers more information about where the coffee is from, but also have the opportunity to purchase the same coffee next year. The potential for communication and feedback is important for quality control, and the economic stability afforded by long term relationships is also important for both ends of the supply chain.

    All of the above has led us to be able to purchase the next coffee for our Grand Cru series. Ato Tsegaye built his first washing station over 15 years ago, and in the time since he has gained a wealth of experience, leading to further improvements in both quality and yield as the years have progressed. In more recent years, he has not only built additional washing stations, but multiple sites dedicated to producing high quality natural lots, in locations among the highest elevations for coffee cultivation. Not only this, but there is now even further levels of separation by village, meaning that exceptional coffees like this can be identified and processed separately.  This coffee is from the Haro Danse village in Kercha. This is exciting information to know, as this coffee in previous years may have simply been sold as Ethiopia Guji. Instead, we have the opportunity to celebrate the microclimate of this particular village, rather than it simply being blended in with other coffees from the area.

    Because this exceptional coffee has been processed separately, it can attract higher prices, with more money returning to the farmers for their stringent quality control practices. The lower quality coffee from the same farms can also be separated out and sold at a lower quality grade price, but further education will allow for a higher percentage of cherry to achieve the price premiums  associated with higher grade coffee in future harvests.

    Those who have been with us drinking specialty coffee for a number of years will know that not all coffees are created equal. Even amongst specialty coffees, we have coffees that end up in blends, single origins that shine bright on their own, and rare coffees that offer something truly unique in the cup. We are thankful that we are able to use both the ECX for our regular Ethiopian coffee, and circumvent it to find something truly special.

    coffee trading, ecx, ethiopia, haro danse, traceability

    Gary Sawyer

    More posts by Gary Sawyer

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