Ethiopian Coffee Cooperative to Double Exports
USAID Support, Financing, New Processing Plant Help Meet High Demand
Over the last several years, the Yirgacheffe Coffee Farmers Cooperatives Union (YCFCU) had to turn away buyers due to an inability to fulfill orders. Both timeliness and quality have hindered the union from realizing the full potential of its members. In 2014, the union’s 26 cooperatives produced approximately 40,000 tons of coffee, of which the YCFCU exported only 2,000 tons, or just five percent.
“The buyers wanted more from us, but we couldn’t deliver. Our organization includes over 43,000 farmers. There is a large variety of coffee grades and some cooperatives just don’t have the technology to process that much,” explains Jebo Werkneh, the Union’s planning and project officer. Another hurdle included the fact that the YCFCU must lease the sole government-owned processing plant in Addis Ababa to meet orders.
USAID AGP-AMDe Strengthens Union Members’ Production, Processing, and Marketing Capabilities
The YCFCU was founded in 2002, four years before the name Yirgacheffe ever appeared on a bag of coffee at Starbucks or other outlets. Each year, the union produces Yirgacheffe, Sidamo, and sun-dried coffee. By 2010, all 26 cooperative members had received Organic and Fair Trade certification, and three cooperative members were certified by the Rainforest Alliance.
In 2012, the union partnered with the USAID AGP Agribusiness Market Development (AGP-AMDe) program to strengthen member capacity in production, processing, and marketing. USAID AGP-AMDe first trained cooperative management and member farmers on post-harvest handling, proper cleaning, sorting, and storage techniques to ensure quality and minimize post-harvest losses. Next, the program provided leadership, marketing, recordkeeping, and operations trainings to cooperative leaders. These workshops culminated in a business and marketing plan.
YCFCU Secures Close to $4MUSD Loan and Provides Employment Opportunities to Women
The program also provided the YCFCU an in-depth review of its financial needs and linked the union with the Commercial Bank of Ethiopia for a loan worth nearly $4M USD. The union will use the money in 2015 to purchase coffee from members.
AGP-AMDe partnered with targeted cooperatives to start coffee nurseries, which provide another source of income and create further employment for farmers, especially women. In 2015, the program awarded matching grants worth more than $200,000 USD to four cooperatives to purchase and install coffee washing machines, power generators, and other critical equipment like samplers, moisture testers, and scales.
2015 Coffee Exports Expected to Double Thanks to Union’s Own Warehouse and Processing Plant
The YCFCU expects to double coffee exports in 2015 to 4,000 tons thanks to the coffee warehouse and processing plant the union inaugurated in Addis Ababa earlier this year. “We have gone through major changes. Our members have capital, the government is backing us and farmers are working hard,” Werkneh comments. He adds,“This year, every member will be equipped, and our union is better prepared for orders than ever.”