- Ethiopian coffee’s growing popularity among consumers testifies to the huge potential of African products in the Chinese market.
- China was among the top 10 buyers of Ethiopian coffee in July and August. It will become one of the top five Ethiopian coffee importing countries within the next five years.
- The East African nation, a major African coffee producer, exports on average 200,000 tonnes of coffee annually over the last decade, mostly to Europe, North America, and East Asia.
- Data from China’s commerce ministry showed that trade between China and Africa rose 40.5 percent year on year to 139.1 billion U.S. dollars.
On the bustling Coffee Street at Gaoqiao Grand Market in Changsha, capital of central China’s Hunan Province, a row of coffee tree seedlings in front of the shop of Shenghe Coffee make an attractive facade decor, drawing curious eyes.
Inside the shop brimming with coffee aroma, a barista is absorbed in preparing a cup of coffee for his Chinese customers, using authentic beans from Ethiopia, known as the birthplace of coffee.
Among the rolling hills in Jimma Zone, southwest Ethiopia, farmers are busy picking organic beans, hoping to get the best price for their harvest and export to a ready market in China, where coffee consumption has been growing exponentially at a reported rate of 15 to 20 percent annually.
From farms to cups, Ethiopian coffee’s growing popularity among consumers testifies to the huge potential of African products in the Chinese market and epitomizes the strong Africa-China economic ties that are further evidenced by the ongoing Second China-Africa Economic and Trade Expo (CAETE) held in Changsha on Sept. 26-29.
Israel Degefa, CEO of Kerchanse Trading Private Limited Company, the largest producer and exporter of coffee in Ethiopia, has been setting his sights on the huge Chinese market.
“From year to year, the volume, quality, and education of coffee in Asia are dramatically changing, especially in China, where our main market is located,” Degefa told Xinhua in a recent interview.
Kerchanse is producing and exporting diversified types of coffee by operating with 63 washing stations, 56,000 out-growers, and 1,500 hectares of land dedicated to research and developing varieties of coffee.
“When we started 3-4 years ago exporting to China, it was a tea marketplace, not a coffee marketplace, but now it’s changing. The cultural shift is bringing a lot of opportunities for coffee-producing countries like us,” Degefa said.
Predicting that China will become one of the top five Ethiopian coffee importing countries within the next five years, Degefa is working to introduce his firm’s coffee products to as many Chinese customers as possible, including through attending the upcoming China International Import Expo (CIIE).
According to the Ethiopian Coffee and Tea Authority, China was among the top 10 buyers of Ethiopian coffee in July and August.
The fourth China International Import Expo is scheduled for Nov. 5-10 in Shanghai. The event provides a platform for companies around the world to display their products, promote their brands and find more business partners in the world’s second-largest economy.
“We have our agent in China. He will attend the expo and show Ethiopian coffee on behalf of us there,” said Degefa.
“These kinds of platforms are very helpful. They will create a good relationship between buyers and roasters,” he said, adding that the CIIE will also help the Chinese community understand the difference between Ethiopian coffee and other types of coffee.
In addition to the huge amount of personal connection his firm expects to form at CIIE 2021, Degefa pointed out that his firm also expects to showcase the organic and high-quality coffee products exported by Kerchanse.
Yohannes Dinegdie, processing and warehousing manager at Kerchanse, said the Chinese market will be key to helping the firm achieve the goal of 55,000 tons of coffee exports during the current Ethiopian Fiscal Year 2021/2022 starting July 8.
“China is a big country, the aim of Kerchanse is to satisfy its customers’ needs according to the customer order and preferences,” Dinegdie told Xinhua.
Kerchanse is boosting its quality control department to ensure that coffee exports to China meet the taste preference of Chinese customers.
“Most of the time Chinese customers’ preference depends upon the food they eat, as they relate it to the food they eat,” Bacha Lencha, a senior coffee quality controller at Kerchanse told Xinhua.
“For example, they need anaerobic coffee, which means coffee that has a fruity flavor, so the Chinese market always prefers to consume coffee that has fruity characters,” he said.
Lencha said the company’s coffee always aims to retain top preference by foreign customers including Chinese ones.
According to the Ethiopian Coffee and Tea Authority, in the previous 2020/2021 fiscal year, Ethiopia earned 906 million U.S. dollars through exports of 248,000 tons of coffee.
AFRICAN COFFEE PROMOTED
As a coffee enthusiast, Jing Jianhua, an award-winning barista and certified trainer from China’s Shaanxi Province, first heard of African coffee in 2000 when he began his career as a young man. “The birthplace of coffee is in Ethiopia. An old story goes that an Ethiopian shepherd’s goat eating coffee beans led to the discovery of coffee. I have always been fond of African and Ethiopian culture,” Jing told Xinhua in an interview.
Jing, also the founder of Shenghe Coffee, dreams of bringing the best African coffee to Chinese consumers at an affordable price. His company’s business ranges from retail and coffee bean supply to shop design, training, as well as coffee-related equipment.
In 2017, Shenghe Coffee entered Gaoqiao Grand Market, which Jing believed was the best market for coffee trade in China. This platform has since enabled the company to do business with clients from across the country and satisfy their diverse needs from coffee making equipment, supply of coffee beans, staff training, shop management to brand counseling.
“In 2018, the Hunan provincial government organized a business tour to Africa and I had the chance to travel to Ethiopia to see the coffee farms and how beans are processed, roasted, and sold. Coffee is a major source of income for many Ethiopian families and the local farmers yearn to sell their coffee to the world,” he said.
“When I saw a primary school with shabby facilities and the school children waving to me, I felt that these children should be allowed better conditions for learning. I thought then that if I could help the locals sell more coffee, they and their children would live better lives. These high-quality Ethiopian coffee beans must be known by more people,” Jing said.
The company now imports up to 100 tonnes of coffee from Africa every year, and is seeking to increase the import by three to five folds over the next three years, he said.
“Before the expo (CAETE) was created, we had sourced our beans through intermediaries. Now with the expo, we can directly purchase from Ethiopia, which reduces our purchase cost by 30 percent,” said Jing, who also revealed his plan to open more coffee shops in China in the future.
According to data from Gaoqiao Grand Market, Shenghe Coffee is just one of the nearly 20 coffee houses situated on Coffee Street.
AFRICAN FARMERS BENEFITING
Hussein Mohammed, a coffee farmer from the Gomma district in Jimma Zone, Ethiopia, relies on coffee farming to provide for his family and his children’s education but is worried about market access.
“Coffee farming needs a lot of money. By the time when the coffee beans ripen, because the market is small, it becomes very difficult for livelihood. We don’t get the worth for our hard efforts,” he lamented.
Tanashe Eyasu, a local agricultural specialist, said that since 2015, Gomma district’s coffee production has been on the upswing with many farmers engaged in coffee production, among whom 310 farmers have export licenses.
“However, it’s no more than 10 farmers who have had the opportunity to export coffee due to lack of market interconnection,” Eyasu said, adding that farmers can benefit more if they can export coffee directly without intermediaries, especially to the enormous Chinese market.
Ethiopia reported coffee export revenues of more than 115.46 million U.S. dollars, and China was one of the top ten buyers. The East African nation, a major African coffee producer, exports on average 200,000 tonnes of coffee annually over the last decade, mostly to Europe, North America, and East Asia.
“We’re promoting our coffee as organic coffee, meaning no application of artificial fertilizer, chemicals or pesticides … It’s very good for health,” said Kunzewa Ahmed, coffee quality and value chain supervisor at Ethiopian Coffee and Tea Authority Jimma Zone Branch.
The agency said in June that Ethiopia had launched an initiative to lure Chinese investors to join local coffee roasters for value addition and increase direct coffee export to China.
EXPO BOLSTERING TRADE
Data from China’s commerce ministry showed that trade between China and Africa rose 40.5 percent year on year to 139.1 billion U.S. dollars while Chinese direct investment in Africa reached 2.07 billion U.S. dollars in the first seven months of the year, exceeding the pre-pandemic level.
As a concrete outcome of the Beijing Summit of the Forum on China-Africa Cooperation held in 2018, the biennial CAETE now welcomes its second gathering since its debut in 2019 and is set to further boost commerce. The booming Gaoqiao Grand Market has been the epitome of closer business connections.
Amid the COVID-19 pandemic, the expo is held both virtually and physically. According to the organizer, representatives from more than 40 African countries are participating. Meanwhile, more than 260 enterprises are exhibiting products at the expo, including companies from 37 African nations, which seek to promote their treasured brands of wine, coffee, cocoa, tea, jewels, and skincare products, among others.
The organizer also revealed that the second CAETE has recorded in total 569 proposed cooperation projects, out of which 120 deals on trade, investment, project contracting, and strategic cooperation valued at 22.9 billion U.S. dollars are expected to be inked during the expo.
Barely two weeks before the expo, China’s industrial hub of Zhuzhou in Hunan Province also launched a searail transport service to Africa, linking cities in Hunan and south China’s Guangdong Province before goods are transferred onto ships to reach ports in Africa. The first consignment of goods weighing 1,935 tonnes is expected to arrive at Mombasa Port in Kenya on Oct. 15.
In a speech delivered through a pre-recorded video for the expo, Chipoka Mulenga, Zambia’s commerce minister, said it is gratifying to note that the Chinese government has taken this initiative to provide an innovative platform for promoting investment cooperation.
“I am confident that following this conference, we shall witness an increased flow of investment into Zambia,” Mulenga said.
James Kimonyo, Rwanda’s ambassador to China, said in a phone interview with Xinhua that the country is promoting coffee, chili, tea, handcrafts, and avocado oil at the expo.
For the year’s CAETE, Rwanda has been invited as one of the “guest countries of honor,” which allows for more exposure to Rwandan products at the international platform.
Rwanda’s presence at the expo will help the country reach out to more consumers and dealers, increasing the awareness of its domestic brands, he said. “We believe that our country pavilion will be receiving a lot of visitors, buyers, and business people. We expect to attract more companies from China looking for business deals with companies from Rwanda.” Enditem