In Ethiopia, New EU Regulations Require Ingenuity—And Technology—To Protect Coffee’s Future

It’s not a controversial statement to say Ethiopian coffee is popular.

In addition to being the genetic point of origin for the coffee plant, the biggest producer of coffee in Africa and the fifth largest in the world, Ethiopia boasts some of the most revered flavors and experiences among coffee connoisseurs across the globe. Sub-regions like Limu, for instance, have become renowned for producing Arabica coffee with a spicy, wine-like complexity. From its hilly origins in the remotes of South Western Ethiopia, it is highly sought by many roasters in Europe and the United States.

As with all coffee in the world, there are real people responsible for the successful cultivation of Limu. Among the producers of Limu coffee in the Oromia region is the Limu Inara Multipurpose Cooperative Society, which boasts 95 primary cooperatives and a membership of 34,687 farmers across the Oromia Coffee Farmers’ Cooperative Union. In 2021/2022, Ethiopia produced 496,200 metric tonnes of coffee, and estimated that the 2023/2024 the production will increase to 501,100 metric tonnes. In 2021, Ethiopia exported a total of $1.16 billion of coffee; Germany alone accounted for 75.6 million dollars worth of it.

But that export model is now threatened. With a European Union deforestation law set to be implemented in December this year, coffee exports especially from places like Ethiopia will be greatly impacted. In response, Ethiopian smallholder coffee farmers are betting on technology including blockchain, geospatial AI, GPS, and satellite imagery to comply in order not to lose out on the European Union market.

According to the European Coffee Federation, the European Union imports 3 million tonnes of coffee annually. In 2019 for instance, countries with the most exports of coffee to the EU were Brazil, Vietnam, Honduras, Colombia, Uganda, India, Peru, and Ethiopia in order of quantity. That year, Ethiopia exported 83,722 tonnes of coffee to the EU.

When the European Council gave its final go-ahead for the implementation of the regulation in May last year, it stated that “the regulation sets mandatory due diligence rules for all operators and traders who place, make available or export palm oil, cattle, wood, coffee, cocoa, rubber, and soy from the EU market.”

Before this, developing countries responsible for exporting many of the commodities covered in the regulation wrote a letter in protest. Envoys to the European Union from Argentina, Brazil, Colombia, Ghana, Guatemala, Nigeria, Indonesia, Ivory Coast, Peru, Honduras, Paraguay, Malaysia, Bolivia, and Ecuador signed the joint letter.

In the letter, the envoys termed the law as flawed and called for cooperative means to combat deforestation instead of the law. “The country assessment criteria and benchmarking system are inherently discriminatory and punitive. Its most likely effect will be to generate trade distortion and diplomatic tensions, without benefits to the environment,” the letter read. With little amendment, however, the council ratified the law hence the December deadline.

The regulation requires of companies wishing to export the commodities to the EU to undertake due diligence on the production of the commodities. The law suggests that the company ought to gather geographic information on the plot of land the commodities were sourced from, assess the risk of non-compliance to the EU deforestation-free regulation, and mitigate risks to negligible levels. This disrupts the norm and introduces a new way in how companies buy coffee from Ethiopia and other countries. While much is needed from these companies, the burden also falls on the farmers who need to comply to remain competitive.

Technology will however be integral in achieving compliance to the regulation. Many companies and organizations have fronted different solutions including blockchain-led solutions, geospatial AI, and satellite imagery among others.

In Ethiopia, Limu Inara is looking at blockchain technology, provided by Dimitra, an American Agri-tech company, as a route to compliance. When the cooperative signed an agreement with Dimitra, the cooperative union’s General Manager, Miftahu Jemal said that he was thrilled about the partnership and of the prospects of “increasing crop yields, simplifying technology adoption, better education for increasing yield and product quality.”

Dimitra’s offering includes five platforms across the Dimitra Connected Coffee Platform & Deforestation Compliance Module, all blockchain-based. Victor Femi-Fred, Dimitra’s Director of Sales in Sub-Saharan Africa said that the impact of the EU’s deforestation law on coffee exports from Ethiopia is a reality. With the technology, they hope to enable farmers to modernize and digitize various agricultural processes. Through blockchain-based technology, they will enable them to assess deforestation and ensure compliance. “The platforms avail the farmers’ traceability and immutable data regarding the farming practices in line with global best practices that will ultimately add significant value to the coffee produced by Ethiopian farmers,” he said.

In the partnership, Dimitra will train some of the members of the cooperative society and they in turn will train others. Ultimately, the over 50,000 members of the cooperative society will be trained after a few months in the hope that the same will be done in time for the regulation to take effect.

According to Dimitra, their Connected Farmer platform is targeted at supporting small farmers to record their farming activities, create and receive detailed dashboard reports, and receive recommendations that will allow them to make informed decisions that directly impact their profitability and standard of living. The platform, it states on its website, “integrates a series of advanced technologies including artificial intelligence, blockchain, satellite, drones, IoT sensors that provide farmers with actionable data that fundamentally improve their operations across several financial and sustainability metrics.”

With information from this platform, Fred believes that farmers in Ethiopia will be compliant with the EU regulation. “This practice will further go a long way in safeguarding their market access within the European Union, while also ensuring open doors to opportunities of reaching new markets that prioritizes sustainability for their products,” he said.

The project is however yet to start. Tesfaye Haliyu, who works with Dimitra in Ethiopia said that they are in the planning stages to train trainers of the farmers before they roll out the blockchain-based platforms.

Since the regulation was passed in the EU, many companies have positioned themselves to provide the technology to comply with it. Besides Dimitra and other companies, non-profit organizations are partnering with farmers for compliance. Technoserve, an NGO, announced in November last year that it was working to build a free, open-source Android application that will allow users to easily capture and share geotagged farm-level sourcing data with engineers from the European Union Agency for the Space Programme (EUSPA).

Unlike Limu Inara, other cooperatives’ unions in Ethiopia are looking at alternative avenues to pursuing compliance away from Dimitra’s offering as they inch closer to the deadline. Dejene Dadi the General Manager of Oromia Coffee Farmers’ Cooperative Union said that he has heard of Dimitra and other for-profit companies like Inventa but as a Union, they were not convinced. “I don’t know what their end-game is,” he said.

On its own, the Oromia Coffee Farmers’ Cooperative Union has completed a traceability pilot program that involved 5,000 farmers. “We equipped the farmers with GPS units and shared the data with some of our European Union clients. They are confident with our project and happy with the result,” said Dadi. This is because the regulation clarifies that GPS coordinates be provided for plots less than four hectares. Bigger plots require polygons.

The Union exports between 3,000 to 7,000 tonnes to the EU every year. Dadi, who is also the Vice Chairman of the Fairtrade Audit Risk Committee in East Africa, is worried because the union isn’t able to equip all the farmers with the technology to enable traceability. They are working on proposals for the EU, GIZ, and the German Embassy in Ethiopia to support them in equipping the farmers for compliance.

The Union is confident that the 5,000 farmers they have equipped will be certified and found compliant with the EU deforestation law. Dadi hopes that come December the Union will have secured funding to pursue compliance for all their 500,000 farmers. “We have no option,” he said. “If we get support, we will ensure we comply but if we don’t get the support then we will have to maintain the farmers already supplying to the EU and then focus on other markets.”

The Oromia Coffee Farmers’ Cooperative Union exports 31% of its coffee to the European Union. But for how long?

Anthony Langat is a freelance journalist based in Kenya. Read more Anthony Langat for Sprudge.


Coffee In The Congo: On The Path To Becoming The “Democratic Republic of Coffee”

The plight of the Democratic Republic of Congo (DRC) is widely known, from militia and rebel activities to human rights violations, gender-based violence, and other atrocities. The violence has resulted in six million deaths, seven million internally displaced people, and over one million Congolese refugees since 1996 (per the Council on Foreign Relations). These overlapping conflicts have negatively affected the Congolese economy and repressed living standards.

Fortunately, this is gradually changing with efforts in full gear to transform the Central African country with more than 100 million citizens back to peace and stability using coffee. Thanks to coffee stakeholders, the country is now becoming the Democratic Republic of Coffee.

Coffee Potential

DRC has an ideal coffee-growing climate and hilly terrain making it a haven for Arabica and Robusta coffee (13 and 87% respectively). In the 1980’s coffee export was the second most lucrative after copper. It was a large-scale cash crop during colonial rule but declined during dictator Mobutu’s reign. The violence then almost obliterated the crop after farmers abandoned their farms. The country was producing 120, 000 tons in 1993, but just 8,000 tons in 2016.

Can the coffee sector in DRC do better? Coffee farmers, the government, coffee companies, donors, and other players are optimistic.

Kambale Kisumba Kamugele

“Coffee is crucial in the process of economic recovery of the DRC. With its rich soils and favorable climate, and the renewed interest in its coffee from global consumers, the sector is experiencing a real recovery” Kambale Kisumba Kamungele tells Sprudge Media. Mr. Kambale is the Chairman of the African Fine Coffees Association (AFCA) DRC Chapter, Emeritus President of the Association des Exportateurs de Cacao (ASSECCAF), and Executive Director of Café Africa RDC.

The DRC, with its favorable eco-climatic and edaphic conditions, abundant hydrography, and diversified landscape, is home to some of the best coffees in the world. The eastern regions of the DRC, defined by the soaring Ruwenzori Mountains and the volcanic Virunga range, are renowned for exceptional Arabicas with their unique flavor profile frequently sampled as floral, fruity, and complex.

“With rich biodiversity and Coffea Canephora coffee species native, Congo Basin boasts a uniquely creamy Robusta coffee profile, especially when used in espresso blends,” says Kambale. “In the southwestern region of Mayombe, the Petit-Kwilu varietal of Robusta stands out for its unique flavor and smaller beans, not to mention the well-balanced taste, making it a sought-after [bean] by coffee connoisseurs.”

Read on to discover some of the initiatives that are transforming the DRC using the grandeur of these dark green and waxy-leaved trees with mouthwatering cherries.

Changing Lives through Café Africa RDC and Karawa Coffee Project (KCP)

Founded in 2010, Café Africa RDC is transforming the coffee sector. With its flagship Karawa Coffee Project (KCP), it is promoting the production and marketing of Robusta coffee in the Ubangi region of DRC. The project has registered and trained 2,188 coffee producers and formed them into a cooperative. In 2022, KCP realized an increase of 100 tons in harvest that was almost entirely consumed locally to the delight of local consumers, and roasters, and has contributed to the new wave of coffee in Africa.

“Tea is popular in Africa and the DRC is not an exception. But there are areas such as Ubangi, with a rich coffee tradition.  In the last years, thanks to the emergence of the Specialty Movement that started in the Kivu region, domestic coffee consumption is on the rise,” observes Kambale.

Coffee Project for Former Congolese Combatants

Thousands of former rebel fighters and coffee smugglers are laying down their guns and turning to coffee. Through an initiative by the Coffee Cooperative Planters and Traders of Kivu (CPNCK), more than 2,400 former dissidents are now working on a coffee plantation on Idjwi island of Lake Kivu (now called Peace Island). The country is exporting more high-quality coffee to the US, Belgium, and France.

“[The project] helps ex-combatants to make their own money and not from kidnapping or rape,” Gilbert Makelele, the project owner, told BBC adding that “everyone in the Congolese army is there because of unemployment”.

Mighty Peace Coffee Promoting DRC Coffee in the US

Mighty Peace Coffee is a social impact initiative that connects Congolese coffee farmers to American coffee roasters. According to Jim Ngokwey, the Managing Partner, more than 100 coffee producers have been trained, purchased, and paid more than $1.5M worth of coffee since 2020. This has increased the volume of women-produced coffee in DRC, and connected more than 200 roasters in 38 states in the US through the initiative.

Jim Ngokwey
Jim Ngokwey

“The future looks bright!” Ngokwey tells us. “There is an increasing appetite and demand for coffees from emerging countries positioning the DRC as one of the countries the market turns to.”

Linda Mugaruka, Mighty Peace Coffee
Linda Mugaruka, Mighty Peace Coffee

As a Congolese coffee expert, Ngokwey has made serious observations in the field and is highly optimistic about opportunities through coffee. “Coffee versatility and quality coupled with resilience of the Congolese are the main reasons why the crop is becoming an essential backer to the country’s economy,” he says. “The civil and political unrest was driven in part by a struggling economy, and agriculture, including coffee, will help to rebuild the economy and bring lasting stability.”

La Kinoise, DRC’s Home-Grown Coffee

The La Kinoise grows coffee on a 20-hectare farm on the peripheries of the city and uses ingenious mobile coffee carts targeting low-income buyers. Deviating from the norm, coffee processing is done locally, and in addition to earning a decent living, women working here receive training in coffee farming, harvesting, and processing.

Tisya Mukuna, the entrepreneur behind La Kinoise believes that a shift from over-reliance on government and politics is the key to realizing economic change. As she told Africa News, “It is the economic actors that can change Africa and Congo” by creating jobs.

According to Kambale, “Coffee has the potential to transform our society. By creating job opportunities and generating income, initiatives such as these are helping to combat unemployment. They provide livelihoods and create a ripple effect of positive change throughout the entire value chain.”

These sentiments are echoed by Ngokwey who states, “One organization or group will not solve all of the challenges, but the more there are leaders and entrepreneurs with a shared vision for the Congolese coffee industry, the faster the transformation will happen.”

Other Initiatives

Many other efforts are being made in the country. For example, fighting for coffee in the Congo is bearing fruits through initiatives such as Saveur Du Kivu. This is an annual specialty coffee cupping competition and summit for coffee representatives throughout the international supply chain. Higher Grounds Coffee also has Lake Kivu Coffee Alliance that uses re-emerging coffee sector to rehabilitate victims of landmines in DRC. Through a USAID-funded Strengthening Value Chains (SVC) program, TechnoServe and Nespresso are also transforming the coffee sector in the DRC.

But despite obvious economic benefits, coffee in DRC is not without challenges. Coffee is smuggled across the borders in large scales. Experts believe more coffee is smuggled to Rwanda and Uganda than what is exported legally.

“It’s a challenge that stakeholders such as ourselves, producers, cooperatives, and various agencies, are working hard to tackle,” Ngokwey notes adding that “At the core of it, it’s a matter of money, taxes, and brand reputation.” He identifies measures that can curb this challenge as rapid and cost-effective access to financing for producers, simplifying and reducing the costs of the exporting process, and rebuilding DRC coffee reputation as cost-effective, reliable and sustainable to create demand.

Looking Ahead

Experts believe the DRC is on the right track to becoming the Democratic Republic of Coffee.

“The DRC has been dubbed the final frontier for specialty coffee. After years of strife, demand for Congo Coffee is surging. Newly adopted agricultural practices, the post-harvest processing of the beans, and the rediscovery of unique cupping characteristics by the global consumers are driving the demand. All these ingredients put together and the future will witness the emergence of the Democratic Republic Coffee,” Kambale says.

The DRC has the necessary resources to become one of the world’s most important coffee producers, according to Ngokwey. “We have the people, climate, soil, land, and more to get there and build that reputation and brand. We are on the right path and consistency and continuous improvements will be the key to our success over the long term.”

Daniel Muraga is an anthropologist and freelance journalist based in Nairobi.


New Wave of Coffee in Africa

It is 8:00 AM at Aspire Centre, located in the Westlands neighborhood of Nairobi, and barista Robert Oldatir Wanderi is on bar. We’re at the Barista Coffee Lounge, a coffeehouse that offers a wide selection of coffees from across Kenya. Like many other working baristas in big-city coffee shops across Kenya, Wanderi braces for yet another busy morning.

He switches on the espresso machine and allows pressure to build up. He then checks the calibration of the grinder to ensure the grind is to satisfaction. His customers today will order all different types of coffee, including espressos, Americanos, macchiatos, cappuccinos, lattes, and mochas, as well as French press.

“Our clientele mostly consists of men,” says Wanderi.  “Most of our clients fall between the ages of 20-40 on average and consist of professionals working remotely, friends meeting for a catch-up, and corporates utilizing our conferencing facilities. We mostly cater to the middle- and upper-middle class. Students are not avid coffee drinkers hence we hardly have them for clients,” he tells Sprudge.

Each day, billions of cups of coffee are consumed across the globe. The coffee world tends to be split into two halves: consumers (economically powerful countries) on one hand, and on the other, producers (also the least developed countries). Africa largely falls in the producing category, with the vast majority of its coffee exported to the global market; the notable exception here is in Ethiopia, where a longstanding local coffee tradition has roots in the very earliest appreciation of coffee as a delicacy.

“Very few producing countries consume locally produced coffee,” admits Charles Denison, co-director of South Africa’s Colombo Coffee. “Many producing countries such as Kenya and Tanzania have a large tea-drinking population, with instant coffee also outselling beans and ground. Price point is also an issue in many communities,” he adds.

Coffee Consumption Background in Africa

Traditionally, Africa has grown coffee for export. The sector has suffered from poor agricultural value chains, high production costs, and an insignificant domestic market. For these reasons and more, coffee producers across the continent have had to export coffee beans instead of extracting the full value. They have had to contend with colonial imperialism that favored the consumption of tea domestically and the exportation of coffee for consumption abroad. Additionally, government policies and value chains made it difficult for coffee beans to flow from farmers to African traders or roasters and to African consumers.

Colombo Coffee

From the farmer, coffee goes to the local buyer, warehouse, transporter, exporter, shipping, to the customs and inspection agents. From there, the coffee changes hands to the importer, roaster, wholesaler, distributor, retailer, to the consumer. To get a cup of coffee, the rural farmer in Africa has to wait for the coffee to change hands again in the reverse direction.

Historically, coffee was brewed using traditional techniques. For example, for many years, old men have taken concentrated hot kahawa chungu (bitter coffee, in Swahili) on the warm streets of the East African coastal towns using tiny ceramic cups. This coffee is brewed over a charcoal stove in large brass kettles evocative of the primordial Arabic world—a communal activity and specialty preserved for men. Gradually, coffee found its way into cafes. Amir Yusuf, Managing Director at Tomoca Coffee in Ethiopia (which also operates a branch in Kenya) captures the main essence of coffee in Africa in his own eloquent way. “Ethiopia is the largest coffee-consuming country in Africa and it is also the origin of coffee,” He tells me. “Drinking coffee in Ethiopia is a tradition and most of the people drink at least three cups a day. While having your cup of coffee you will also interact with other people.” But looking at Africa in general, he says, “coffee consumption is quite low.” Yusuf adds that as the middle class rises, coffee consumption has risen along with it. “More and more people are able to drink a freshly brewed cup of coffee daily,” he says. Yusuf adds that it’s the hope at his company that coffee can be something to bring people together, “kind of like a social therapy”—an aspect of the culture that goes beyond the commodity itself.

Coffee Shop Culture

Today, the new wave of cafe culture is a brewing storm across the continent. Africa is right now enjoying a booming domestic consumption and a flourishing coffee scene.

Tomoca Coffee

Higher-income among the emerging middle class and the proliferation of local and international coffee cafes in major urban centers have led to a burgeoning coffee-drinking movement in Africa. Africa has popular cafes like Neo Café in Nigeria, Java House in Kenya, Kaldi’s in Ethiopia, Good African Coffee in Uganda, Zanzibar Coffee House Café and Le Cafeier Coffee Shop in Burundi, Labone Coffee Shop in Ghana, Tony’s in Zimbabwe, Out of Africa Coffee Shop in Namibia, and Rosetta Roastery in South Africa, and many, many others. Drinking coffee in Africa has become an experience that would not have been imagined just a few decades ago—a new generation of Africans embracing the enjoyment of coffee as a cultural and culinary birthright.

Today, coffee plays an important social role that helps people build relationships that transcend cultural and geographical boundaries. In Africa, coffee is fast becoming an important social lubricant that is helping people better communicate, bond, transact business, hang out, study, work, and perform other important day-to-day activities.

“A cafe has a lot to do with the customers’ personal happy place, reflecting what they relate to best,” says Denison. “Our five cafes are all very different, with the roastery location having an authentic industrial feel, a couple being workplace oriented, and one on a beachside golf course. All with a very different feel and atmosphere.”

Coffee lovers are looking for clean, accessible, and sophisticated leisure spots to breathe off their stresses, Denison says. In response to this, classic coffee shops have risen in the hundreds in major cities. Over a few decades, rural-urban migration, increased travel, and tourism, development of new and expansion of existing urban centers have fueled a vibrant coffee drinking culture in the continent. For example, there were virtually no coffee shops in Kampala 10 years ago.

“There has been an increase in the number of high-end cafes and specialty roasters in the major cities and regions at origin,” says Denison. “For example, in Kampala [Uganda], Kigali [Rwanda], or Nairobi [Kenya], one is looking at double-digit roasteries. In South Africa, in the past few years we have seen more specialty cafes open up in the townships, historically not an option. Trained baristas and roasters are taking quality specialty coffee to areas previously un-serviced by the industry.” Denison estimates South Africa now has about 300 roasters.

Colombo Coffee

“As income increases for the consumer class, they will seek out new experiences that provide value for their money, a focal point for networking, relaxing, and sharing information,” says Dr. Dennie M. Beach, President of Go Africa Cafe, whose most popular shop brand is Kenya AA blend.

COVID-19 Pandemic and Coffee Cafe Response

Unfortunately, coffee cafes were affected by a serious decrease in business due to COVID-19. Since regular business was mostly corporate and since most offices were closed and people were working from home, clientele in cafes had dropped drastically.

To counter this lack of business from regulars, Wanderi tells us, “We made some changes to our menu and offered items that extended our reach from corporate clients to families, individuals, groups of friends, and young professionals. We also added online delivery so as to reach the corporate clients working from home. Additionally, we started engaging social media influencers to further penetrate the market that we had not reached before.”

Yusuf shares the same sentiments, “COVID-19 affected all of us and especially the hospitality sector. People did not go out to get a cup of coffee from a cafe during the pandemic which led to a downfall at most coffee places. The pandemic did on the other hand lead to higher consumption at home. During Covid19 we at Tomoca focused on delivery services of our packed coffee (500g, 250g, 200g, beans, ground) to customers to enjoy in the comfort of their homes. We also shared our own articles explaining how to brew at home and which coffee to choose to help our clients get the same taste at home as in our stores.”

As the pandemic slowly recedes, the promise returns here in Africa, where coffee consumption has become a deeply embedded part of daily life for a new generation of Africans. Many of those who love coffee in Africa today represent something their parents or grandparents could have never imagined: African coffee, cultivated, expertly processed, carefully roasted, and prepared beautifully by Africans, for Africans. Truly there is something special happening here.

Daniel Muraga is an anthropologist and freelance journalist based in Nairobi. This is Daniel Muraga’s first feature for Sprudge.

Photos provided by the cafes, used with permission.


A Better Cup of Coffee: How Africa is Fighting for Improved Coffee Profits

Switzerland is not only famous for its mesmeric alpine sceneries. For coffee lovers, popular coffee shops beckon, like Mame in Zurich, Sleepy Bear in Lausanne, and Boréal in Geneva. It is also home to the coffee-loving tennis world champion Roger Federer (who takes “three to four” coffees a day, enjoying cappuccino in the morning, an espresso after a meal, and occasionally a ristretto just to mix things up). Despite being a relatively small, landlocked country, far away from key trading routes and major ports, it is a leader in transit trading for coffee (and other major commodities such as sugar, grains, crude oil, and metals). Switzerland and other countries in Europe lead the world in global commodities trade despite lacking the climatic conditions necessary to grow most of those very commodities. Europe has built a massively profitable export system through hundreds of years of import and re-export of raw commodities from Africa and other countries in the global south, coffee chief among them. But a new generation of African leaders and coffee producers are calling for change—and what comes next will write a new chapter in the centuries-old coffee trade.

Coffee As A Global Market: A Brief Background

According to an International Coffee Organization (ICO) report, European re-exporting countries earned an average of over $300 per standard bag of coffee exported between 2000 and 2010. Meanwhile, their counterparts in Africa and the rest of the global south earn around $106 per bag, or roughly 1/3rd the total earnings. This is despite the fact that many African countries still rely on foreign exchange for economic development.

Studies show that African nations lose some £8 billion a year from irregularities in commodity trading prices with Switzerland alone. And the Swiss model is not alone; these figures do not include other European commodity re-exporters such as Germany, Belgium, France, Italy, and the United Kingdom.

According to ICO, European countries earn over three times higher from the export of coffee products than countries in Africa. But is it because of value addition? I asked this question of Tedd George, an expert in African markets and commodity value chains and Founder and Chief Narrative Officer at Kleos Advisory Ltd. “The key imbalance in Africa’s coffee trade with the world is the fact that Africa is exporting most of its beans raw and capturing only a small part of their value,” George told me. “The global industry is set up in a way that incentivizes Africa to export its beans raw and this needs to change,” he says, adding that “it’s all about value addition. Africa gets only the price for its raw beans, while in Europe the beans are roasted, packaged, and sold as coffee in cafes. This pushes all of the value addition to the end of the value chain, excluding Africa. The key for Africa is to develop more local roasting and packaging, but also local demand for coffee.”

George’s point is backed up by numbers. According to a report by International Trade Centre, more than 90% of coffee around the world is exported as raw or “green” beans, owing to coffee’s long history as an export crop. Despite annual international demand for coffee rising by 2%, most smallholder coffee farmers in Africa are languishing in abject poverty. Take, for example, the nation of Kenya, home to some of the most desirable coffee in the world, sought after by coffee roasters all across the planet. Here in Kenya, there are more than 700,000 smallholder farmers, and many of them operate at a loss. And that’s not just here: around the world there are millions of other coffee farmers who struggle to earn a living wage. The coffee supply chain is driven by buyers, and statistics show they capture the vast majority of the profits. What of the farmers?

Understanding the Value-Addition Problem

Samuel Mwithukia Kimani is the Director of Kimani Coffee Experts Ltd, a company that buys, processes, and sells Kenyan coffee locally and to the Far East, Europe, and the USA. Kimani has a unique perspective on the issue of value-addition and is actively working to address the systemic problems facing Kenya’s coffee farmers. “Lack of value addition in coffee—exporting it in raw form along with political and economic instabilities—are factors that put many African coffee-producing countries at a disadvantage at the global market level,” Kimani tells me. “To make the matters worse, many African countries deposit their money in Switzerland. There is cheap money in Switzerland but little or nothing for African farmers.”

Coffee value-addition is touted as one of the main reasons why European countries fetch more profits than their African counterparts. There’s good reason for this, and it’s quite troubling.  “You can only get so much value from a raw coffee bean,” says Tedd George of Kleos Advisory. “As soon as you process it, the value addition starts.” It stands to reason, then, that African countries can become more internationally competitive in advanced coffee processing activities by focusing on adding value first at home. If only it were that easy.

Value-Addition Flaws

“Coffee roasting and packaging is complex,” says George, “and requires cheap and efficient energy, which is not always available in Africa. Africa is unlikely to be able to compete with South America and South-East Asia when it comes to producing bulk coffee, but with specialty brands, it could produce competitive packaged coffee for the world market.”

But according to Angus Elsby, this value-addition narrative is flawed. It assumes the value in final cup taken in coffee joints in Europe is solely derived from better retailing, marketing, and use of more advanced processing methods, like roasting or decaffeinating. This ignores preexistent trade imbalances where global commodity market policies favor European countries. The trend has been the concentration of very large coffee traders leading to monopoly capitalism. Over time, these big multinationals have merged, while enjoying weak, little, or no anti-monopolization laws in home countries, to create even more powerful coffee re-exporting empires setting the bar too high for African coffee farmers.

In addition, the environmental and social costs of coffee production in Africa are usually ignored in the global coffee pricing system. Proper pricing should, as noted by experts, incorporate in the overall cost of coffee, the burden that coffee farming places on society. This includes issues like water and soil pollution, farmers and worker’s social and economic security, as well as a proper living wage. Historically and unfortunately this has not been the case in Kenya, or across the rest of Africa. What comes next is change, and there is no change without a fight—a fight for Africa to earn what it deserves from the global coffee trade.

One Step Forward, One Step Back

Coffee cooperatives in Africa are crucial in buying, setting prices, controlling quality, negotiating prices with global traders, and coordinating coffee auctions. Some cooperatives in nations like Rwanda, Kenya, and Burundi have even become well-known to international specialty coffee consumers, appearing on bags of coffee as trusted purveyors of some of the world’s most delicious coffee. However, following trade restructuring that started in the 1990s, many cooperatives have been dismantled across Africa. This has left the continent with little or no collective bargain in the global commodity market.

Low prices, too much unpredictability, and poor yields (due to changes in climate) not only affect farmers’ revenue, but also decreases interest of present and future farmers in coffee farming. It also causes labor shortages during coffee harvesting time.

“Part of the problem is that Africa is a small player when it comes to global coffee flows,” explains George. “50 years ago when Angola was one of the world’s largest coffee producers, volumes were much lower and Vietnam didn’t even export coffee. Today Brazil and Vietnam account for the vast majority of Arabica and Robusta production and exports, giving other producers in Africa little pricing power,” George explains.

According to the ICO report, exports of all forms of coffee from Africa in the first half of the coffee year 2020/21 reduced by 8.9% to 5.96 million bags. Exports from Ethiopia, Côte d’Ivoire, and Kenya dropped by 28.5%, 49%, and 9.5% respectively.

Figure 1 Total exports over the first half of the coffee year. Source: ICO

Trade imbalance against Africa, along with other contributing factors, has resulted in this fall-off in production. What’s left is an open question: how does African coffee survive when the deck is stacked against it?

Looking Ahead

A diverse pool of experts with various interests agree: in order to get the most out of coffee, the key for Africa is to boost local value addition and consumption, and to develop a robust economy of local specialty brands. Africa has been afforded no real pricing power on the international commodities market, which is flooded with bulk beans; there is a glimmer of hope in the international consumption of high quality, high scoring coffees beloved by Sprudge readers, but this represents but a fraction of total coffee production. In order to impact change in Africa we must address the entire market—not just specialty. But a growing interest in coffee at home, in Africa, offers a path forward.

“The key to getting more value from African coffee is boosting local demand,” agrees George. This shifts the paradigm, making it so producers are not entirely beholden on the export market for their crop. Ethiopia offers an intriguing case study, adds George. “Ethiopia consumes half of its own Arabica production, consequently commanding pricing power for its exports, notably that of Yirgacheffe coffee which commands a high premium, while its neighbor Uganda consumes little of the Robusta it produces and consequently gets a poor price for it.”

The same sentiments reverberated in the words of Mr. Kimani:

“You cannot compare a well processed, packaged, and finished product with raw materials in terms of marketability. We [Africa] should export our coffee in finished form because by exporting in raw form, we are also creating employment in Europe at our disadvantage. We should design our own attractive packaging materials for global competitiveness. We should improve our coffee consuming culture locally thereby improving the local market for coffee.”

How can Africa get a better cup of coffee in the global arena? The answer is promising: domestic consumption and the development of ascendent African coffee brands offers a broad range of benefits for the continent’s coffee farmers. One early leader on this front is the brand African Coffee Roasters. Located in the Export Processing Zone (EPZ) in Athi River, in Keya, ACR was established in 2015 and serves as a perfect case of local coffee processing in Africa.

Among its products include “The Big Five” brand that contains five different single-origin coffees from five different coffee cooperatives in Kenya, Ethiopia, Rwanda, DR Congo, and Uganda. In addition to the value-added at the coffee processing level, the company also sources nearly all of its packaging materials from local suppliers, including laminate material for the pouches, cardboard among others. ACR boasts of a state-of-the-art roasting and packaging facility including two Loring 70kg Peregrine coffee roasters, two form-fill-seal packaging machines, a compostable Nespresso capsule packaging line, a hand-packing line, a fully equipped Quality Control Laboratory, and a nitrogen generator. This equipment is especially important, says Stephen Vick, the Head of Coffee at ACR. “The Loring roasting technology allows for unparalleled control on our roast profiles,” says Vick. “These machines are only four in Africa: our two, one in Kampala and one in Cape Town. In addition to this, our company and facility carry a number of certifications: FSSC 22000 (highest global food safety standard), EU Organic, Fairtrade, Rainforest Alliance/UTZ, SMETA, BSCA, and we are a member of the UN Global Compact,” adding that the future of local coffee production and consumption in Africa is bright “I’ve seen tremendous change in both local processing for export as well as local consumption thanks to brands like Spring Valley CoffeeConnect CoffeeBarista and Co. and others. As the entire hospitality industry in East Africa is dynamically developing (restaurants, beer, wine, cocktails, boutique hotels, etc.), I see coffee naturally following suit.”

Rather than compete with the bulk coffee market—which experts like Tedd George feel is all but impossible—Africa is poised to capture a larger share of the high-end global coffee market. This approach could serve to reduce power imbalances, according to Samuel Kimani. International markets can support this by championing African coffees as special, valuable, and highly sought-after, beautiful examples of coffee’s potential as a culinary wonder. Meanwhile, domestic consumption creates a daisy chain of opportunity for Africans in and around the coffee trade, from cafe owners and entrepreneurs to baristas, hospitality professionals, roasters, and all the way back to the farmers. Governments can also play a role, according to Mr. Kimani, who puts it bluntly: “African governments should be more involved in coffee production and research. Give farmers incentives to produce more.”

The future for African coffee is bright, and it starts right here, at home, in Africa.

Daniel Muraga is an anthropologist and freelance journalist based in Nairobi. Read more Daniel Muraga for Sprudge.