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For 2025, our Ethiopia sourcing plan prioritizes shipping speed and sample integrity through a new chain of custody and payment structure. By maintaining lot separation from farm level through to final milling, we will isolate quality, pay producers immediately during the harvest and build scalable, fully traceable community lots.
Our 2024 import represented a leap forward in our work in Ethiopia. In the South and West, we expanded our networks to include a greater number of smallholder-exporters, many of whom last year sold coffee through direct export channels for the first time to Crop to Cup. We returned to supply chains through which we’ve purchased over our 12 years in Ethiopia, reconnecting and recommitting to those suppliers.
Where we could, we worked deeper—deeper within communities and deeper in the support and services we offered. Our material support included shade nets, Infrared thermometers, and moisture meters for producers as well as Kaffelogic sample roasters for our in-country partners at CoQua. For three producers—Bekele Belaycho, Basha Bekele, and Mate Matiwos—we provided pulpers, resulting in our first ever imports of single-producer smallholder washed coffees from Ethiopia. We offered premiums based on quality, resulting in an additional payment in USD of over $2,000 directly to producers following the export. Four of the producers we bought from—Basha Bekele, Mate Matiwos, Bekele Yutute and Mulugeta Muntasha—were top winners in the 2024 Cup of Excellence competition, and others, including the Nigat family, placed in the top 150.
While qualities improved in 2024, we failed to meet our goals for shipping timing in 2024, regardless of disruptions in the Red Sea. In most cases, exporters in Ethiopia—as everywhere in the world—are paid cash against documents. This means that delays in export stemming from delays in approvals resulting from DHL transit, for example, or an inability to match an offer sample to a pre-ship and thus requiring renegotiation could cascade through the harvest leading to delayed shipments and delayed payments. But no matter how quickly our U.S.-based labs worked to process samples, we fell behind our schedule as our delays in approvals ran against container shortages and shipping delays.
Over the past month, before our first of three planned visits to Ethiopia this harvest, we met with every key supplier Crop to Cup buys from over Zoom and WhatsApp, sharing quality and sales feedback from the previous year’s import well as providing data to show the efforts we undertook to market their coffee to roasters in North America. If our strategy is to build year-over-year business relationships between roasters and producers, we must work on the behalf of both ends of the supply chain—matching producers with roasters, and roasters with producers, and functioning as a bridge and advocate between.
In parallel, our Ethiopian sourcing chief, Moata Raya, and Senior Field Officer Asnake Nigat visited each producer in our network to explain the particulars of this year’s program and provide additional technical and material support. Quality isn’t an accident; it happens through the extraordinary efforts of growers, collectors and processors, and if we desire quality we must arrange our resources in support of it. Everywhere we travel in Ethiopia, we meet smallholders—smallholders like Shibru Dube and Mengeshe Gumi—who had obtained export licenses but lacked access to a buyer. With only quality-indifferent local suppliers to sell cherry to, practices like selective picking and cherry flotation fell by the wayside. Moata and Asnake meet the challenge with their own expertise and time, which Crop to Cup supports through early forward contracts with premiums paid for quality practices.
In our first visit to Ethiopia in November to the West, we verified lot separation activities and collected a first round of offer samples from the West to convert to contracted lots for rapid milling and export. Through the harvest, our team in Ethiopia is visiting producer warehouses, tagging bags with codes to indicate process, collection dates, and the total number of bags. From this lot, a representative sample is drawn and delivered to Addis for immediate evaluation. If the coffee meets both cup quality and physical standards, it is sent to an intermediary warehouse with other lots awaiting instructions for milling and shipment.
This first visit to the West will be supported by a second visit by our team in December to the South for warehouse and separation inspections, pre-shipment approval from the West and initial offer approval from the South. A third visit in January and February will conclude our preshipment approval process and ensure shipments happen on schedule. With milling periods pre-determined with our in-country partners, our travel this year is in support of field operations and approvals of both offer collections as well as pre-ships. By approving pre-ships in-country and building lots from separations collected at our third party warehouses, we can isolate the highest quality offers and ensure rapid movement of coffee to Addis for milling, early pre-ship approval, and expedited shipping.
While our 2024 import focused on showcasing a diversity of cup profiles and preparations from producers, the resulting lots were often too small to clean and sort through dry mills in Ethiopia, most of which are built to process outturns of 30 bags and larger (in accordance with contractable lot sizes standardized by ECX). For this year, we will optimize our purchasing to build lots from deliveries of cherry and parchment that we estimate would yield 30-50 bags after milling. Because we will be cupping through separations from each producer, we will have the opportunity to isolate those separations with the best quality as well as build larger high-quality single-producer lots and scalable, more affordable community blends. Our intention is to increase our purchasing volume with each producer through quality mapping and lot separation.
Through these mutual efforts, we grow our purchasing from these smallholders each year—making them a staple part of our sourcing efforts in Ethiopia. While in 2024, purchasing of coffee through direct exports from smallholders was 36.1% of our import; our 2025 plan increases this to a majority of our import at 63.4%. These smallholders, too, collect cherry from their neighbor outgrowers, increasing market access for their community and overall prosperity. By serving as a nexus between the coffee gardens of smallholders and the specialty market, these intermediary smallholders who live and raise families in the communities in which they collect cherry serve as impact resonators, offering a higher-paying alternative to extractive large exporters and stabilizing a highly volatile market.
In response to soaring inflation and to curtail black market exchange of foreign currency, before the harvest the National Bank of Ethiopia announced a change to its monetary policy, floating the birr, leading to a rapid devaluation of the local currency. This change came after Ethiopia accepted a new loan from the International Monetary Fund in July meant to reform the economy following the government’s default in December 2023 with stipulations including the removal of subsidies for fuel, privatization of state-owned assets and utilities, moving to a floating currency, devaluing the birr, and inviting foreign banks to operate in Ethiopia. By devaluing the birr, the exchange rate to USD mirrored rates on the black market which had, during the 2023-2024 harvest and in the midst of foreign currency shortages, soared to over 114 birr per USD. Parity between bank rates and the black market was meant to disincentivize black market exchanges and move foreign currency through authorized channels. The hope of these reforms was to stabilize the imbalance between Ethiopia’s exports—like those of coffee—and imports.
As a consequence, costs rose; the cost of fuel, the cost of services, the cost of cherry—and with new regulations in place, bank financing was difficult to obtain for all but the larger exporters and suppliers. Financing rates for those exporters rose from an average of 12% to 18% and, under the new policies, often required collateral. For many coffee producers, banks simply refused to service loans; where they were able to receive financing, loans were based on previous loans without accounting for speculative growth or the devaluation of the birr.
At the beginning of November, with harvest at a midway point in the West and with production lower this year, the price of cherry reached 70-75 birr per kg, compared to 45-55 last year; in the South, where harvest was just beginning and was expected to show increase in volumes over last year, cherry rose to 65-68 birr. For U.S. buyers, though, and for producers with access to USD, this represents a discount over last year as a ratio of cherry price to exchange. As a consequence, with minimum registration prices for Grade 1 and Grade 2s tracking closely with the 2023-2024 season, there is opportunity for those who are able to access financing to take advantage of the opening created by devaluation.
We will begin accepting reservations from roasters in December, with formal contracts to follow as we receive milled preship samples.
If you would like more than 8 samples, please contact a trader directly.