Ethiopian Airlines Slashes Coffee Shipping Costs to Boost Exports

Ethiopian Airlines is offering a significant discount on coffee shipments to Asia and the Middle East, reducing the cost from $3 to $1.5 per kilogram. This move aims to boost coffee exports and counter potential losses from new EU regulations.

The reduced rates benefit both exporters and international roasters, especially those targeting high-end coffee markets in Asia and the Middle East. This strategy focuses on diversifying export destinations, mitigating potential losses from the upcoming European Union’s Deforestation-Free Products Regulation (EUDR) set to take effect in December 2024. The EUDR will make it more difficult for Ethiopian coffee that is not demonstrably grown sustainably to reach European markets, which currently account for roughly 30% of the country’s coffee exports.

The initiative comes as Ethiopian coffee exporters face challenges beyond the new EU regulations. A persistent container shortage, present since the start of the COVID-19 pandemic, remains a significant hurdle, limiting the export of major commodities like coffee. The Ethiopian Shipping and Logistics Services Enterprise (ESLSE) has taken steps to address this issue by procuring additional containers, but the shortage persists. The Ethiopian government has also announced plans to implement digital solutions within the next three months to effectively track and manage available containers within the country.

Transportation and logistics authorities have also highlighted the significant impact of the ongoing security crisis in the Red Sea on Ethiopia’s export and import activities. Major shipping companies have either reduced their visits to the region or suspended operations entirely due to these concerns. This situation has resulted in logistical complications, impacting both the timeliness and cost of Ethiopian exports and imports.

By offering discounted shipping rates and working alongside the government to address logistical hurdles, Ethiopian Airlines is taking proactive steps to ensure the continued success of this vital Ethiopian industry. Coffee is the country’s largest export, and its economic importance cannot be overstated. These efforts will hopefully solidify Ethiopia’s position as a leading supplier of high-quality coffee beans to the global market.

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