Ethiopia is one of the fastest growing economies in Africa, with an estimated GDP growth rate of 10.5% in 2020. It is also one of the largest markets in Africa for Agri-commodity, with a population of over 100 million people.
Agriculture is the mainstay of Ethiopia’s economy and accounts for about 28% of GDP. In addition to food security concerns, Ethiopia is also trying to become a major exporter of agricultural commodities. The country has good potential for both conventional and organic agriculture as well as livestock production.
Ethiopia is the world’s largest coffee producer and the second largest exporter after Brazil. Coffee accounts for more than 25% of Ethiopia’s exports revenues and more than 60% of government revenues come from coffee exports. Coffee production has been declining due to poor weather conditions and disease outbreaks such as rust, which have reduced coffee production by almost 50%. However, coffee production may increase following the recent signing of a peace agreement between Ethiopia and Eritrea that could result in improved access to land previously used by Eritrean farmers who would be returning home after decades away from their fields.
Ethiopia is also one of the largest producers and exporters of flowers in Africa with its flower industry worth $1 billion annually.
Ethiopia Sugar imports from India
Ethiopia imported 4,000 MT of sugar from India during the first quarter of 2019. This is a significant increase compared to the previous year when only 1,500 MT was imported. The country imported 3,000 MT of sugar in 2018.
The country’s domestic sugar production stood at about 600,000 MT during the first half of 2019 and its imports were around 200,000 MT during the same period. Ethiopia has been importing sugar from India since 2017 but no sugar was imported from India in 2018 due to shortage of funds.
Agri-commodity trends between India Ethiopia
India has been a major supplier of agri-commodities to Ethiopia in recent years. This relationship is set to grow as India becomes Ethiopia’s largest trading partner.
The Ethiopian government has identified global agri business as a key industry for economic growth and development. The country’s total agricultural output accounts for 25 percent of its GDP and employs over 80 per cent of the population.
In recent years, the Ethiopian government has made significant strides towards enhancing its agricultural infrastructure and increasing agricultural production. It has also taken steps to boost its domestic food security by investing in irrigation facilities, farm mechanization and improving the quality of seeds and fertilizers available to farmers.
India’s agriculture commodities trading has witnessed strong growth over the last few years due to higher domestic production coupled with lower prices compared to global benchmarks. The country has emerged as one of the world’s largest producers of rice, wheat and sugarcane, among other crops.
Conclusion For Ethiopian Agri-Commodity Market
The agricultural sector of Ethiopia has a long history of involvement with food and fibre export crops. Currently, three main product types are traded on the domestic market: pulses, oilseeds, and coffee. There is a vigorous trade in these commodities as they move down the supply chain towards local and regional markets. All this adds up to produce a vibrant market for maize, sorghum, and other major food crops, and one which is highly competitive in terms of both quality and quantity.
