Arabfields, Mira Sabah, Special Economic Correspondent, Nairobi, Kenya — Ethiopia the birthplace of Arabica coffee, is experiencing a surge in its coffee exports, marking a strong start to the 2025/26 fiscal year. In the first quarter alone, from July to September, the country generated approximately $763 million in revenue from exporting over 113,500 tonnes of coffee beans. This impressive figure, reported by the Ethiopian Coffee and Tea Authority (ECTA), represents a significant increase compared to previous periods and underscores the sector’s growing importance to the nation’s economy.
The recent performance builds on earlier momentum. Just two months into the fiscal year, exports had already reached more than 80,000 tonnes, yielding $546 million. By the end of the quarter, the totals climbed higher, reflecting both rising global demand and domestic improvements in production and trade efficiency. ECTA Director-General Adugna Debela highlighted this as a promising indicator, noting that the sector is on track to meet or exceed annual targets.
Ethiopia’s coffee heritage dates back centuries, with legends tracing the discovery of the energizing bean to a goatherd in the southwestern highlands who noticed his animals’ unusual vitality after eating the red cherries. Today, the country remains one of the world’s top coffee producers, cultivating primarily Arabica varieties renowned for their floral notes, bright acidity, and complex flavors. Regions like Yirgacheffe, Sidama, and Guji are synonymous with premium specialty coffee, attracting buyers from around the globe.
Coffee plays a central role in Ethiopian culture and economy. It accounts for about a third of the country’s export earnings and supports the livelihoods of millions. Approximately 15 million Ethiopians, roughly 12% of the population, are involved in the coffee value chain, from smallholder farmers tending shade-grown plots to processors and exporters. Domestic consumption is also high, with per capita intake around 2.3 kilograms annually, fueled by traditional ceremonies where freshly roasted and brewed coffee is shared among family and friends.
Despite this legacy, the industry has faced challenges, including fluctuating global prices, climate variability, and supply chain inefficiencies. In recent years, however, strategic reforms have begun to transform the sector, driving the current export boom.
Several key elements have contributed to Ethiopia’s strong export performance. Foremost among them are ongoing reforms in the coffee supply chain, aimed at enhancing efficiency and empowering producers. One major change allows farmers with at least two hectares of land to sell directly to international buyers, bypassing traditional intermediaries. This direct trade model not only streamlines the export process but also ensures that more revenue flows back to the growers.
Additionally, the establishment of new washing and grading centers near farming areas has revolutionized post-harvest processing. These facilities enable better quality control, with beans being washed, sorted, and dried under optimal conditions to preserve their premium characteristics. By improving product quality, these centers have helped Ethiopian coffee command higher prices on the international market, prices that surged from around 270-280 U.S. cents per pound in mid-2024 to over 420 cents by early 2025, driven by global supply tightness.
Decentralization of quality inspections has further accelerated exports. Previously concentrated in the capital, Addis Ababa, these controls are now conducted closer to production sites, reducing transportation delays and costs. This shift has been particularly beneficial for remote farmers, allowing quicker market access and minimizing spoilage risks.
Global market dynamics have also played a role. Rising demand for specialty Arabica, coupled with supply disruptions in other producing countries, has boosted prices and volumes. Ethiopia’s top export destinations include Germany, Saudi Arabia, Japan, and the United States, where consumers prize the unique profiles of Ethiopian beans.
Looking ahead, Ethiopia has set bold goals for the 2025/26 fiscal year: exporting up to 600,000 tonnes of coffee and generating $3 billion in revenue. This represents a substantial leap from the previous year’s 470,000 tonnes and $2.2 billion. Forecasts from agricultural analysts suggest production could reach 11.6 million 60-kilogram bags (about 696,000 tonnes), with exports potentially hitting 7.8 million bags (468,000 tonnes), though value targets account for premium pricing.
To achieve these objectives, the government is investing in productivity enhancements. Initiatives include distributing high-yielding seedlings, promoting tree rejuvenation through stumping on over 450,000 hectares, and providing training on sustainable farming practices. Efforts to comply with international regulations, such as the European Union’s Deforestation Regulation, are also underway to ensure continued access to key markets.
However, challenges remain. Climate change poses risks through erratic rainfall and pests like the coffee berry borer. Political instability in some regions could disrupt supply chains, and the sector’s reliance on smallholders, many operating on less than two hectares, limits scalability. Moreover, while high prices benefit exporters, they can strain domestic consumers and spark shifts toward alternative crops like khat or eucalyptus if not managed carefully.
The coffee boom is rippling through Ethiopia’s economy. Increased foreign exchange earnings help address chronic shortages, supporting imports of essential goods and stabilizing the birr. For farmers, higher incomes mean better access to education, healthcare, and infrastructure. In rural communities, where coffee farming is often a family affair, these gains foster social stability and reduce poverty.
Women, who play a pivotal role in harvesting and processing, are particularly benefiting from reforms that emphasize inclusivity. Programs aimed at gender equity in the supply chain are empowering female producers, ensuring they receive fair shares of premiums.
As Ethiopia positions itself to potentially become the world’s second-largest coffee exporter by 2033, the sector’s success could create millions of jobs and drive broader economic diversification. With a comprehensive national strategy in place, the future looks promising for this iconic industry.
In summary, Ethiopia’s coffee exports are not just a source of revenue but a testament to the country’s resilience and innovation. As global tastes evolve, the rich, aromatic beans from its highlands continue to captivate, promising sustained growth for years to come.
