Ethiopian Commodity Exchange (ECX) was created in order to eliminate food shortages and famine in Ethiopia, establishing an effective system of trade for agricultural commodities. Almost two months after the beginning of the highly praised exchange platform is becoming increasingly complex environment of global trade coffee company, which is totally different and far from the original vision of "revolutionary" in the internal market inefficient.
In August 2008 the government adopted a new law that requires all trade cafes in the country through the ECX ECX and welcomed the decision. Since then, the government confiscated the existence of the export of coffee and revocation of licenses, fill the vacuum with Ethiopian Grain Trade Enterprise (EGTE), especially of goods sold cafes class coffee prices.
After a rough first meeting, ECX involved in negotiations with buyers, especially coffee or challenged wining hearts and minds of local merchants. But the effect of coffee on ECX still noticed. This test piece shows pitfalls of negotiating through ECX coffee and its impact on small-scale farmers.
Learn coffee in Moscow
As is clear, ECX is not prepared to business operations of the entire complex, the choice of coffee exports. This partly explains why there ECX Run in trouble as soon as it started its coffee business.
ECX was originally designed to create a trading platform for domestic agricultural goods, especially degrees. ECX is designed with the purpose of removing archaic system of a market failure, as the founder of ECX, Elena Gebrs-Medhin, are partly responsible for the recurrent food shortages and famine in parts of Ethiopia, and increasing value of major household . Dr. Elena describes his vision in June 2007 in a TED Talk:
"Ethiopia on the domestic market is about $ 1 billion of values and way over the next five years, if Ethiopia can capture up to 40%, only 40 percent of the domestic market and 25% expected total value of this market, double the value market. ECX , moreover, becomes a platform for trade with the Pan-African market for agricultural goods. ethiopia agricultural market is 30 percent higher than South Africa, great production, and in fact, Ethiopia is the second largest producer of maize in Africa. "
In August 2008 the government adopted a new law that requires all trade cafes in the country through the ECX ECX and welcomed the decision. Since then, the government confiscated the existence of the export of coffee and revocation of licenses, fill the vacuum with Ethiopian Grain Trade Enterprise (EGTE), especially of goods sold cafes class coffee prices.
After a rough first meeting, ECX involved in negotiations with buyers, especially coffee or challenged wining hearts and minds of local merchants. But the effect of coffee on ECX still noticed. This test piece shows pitfalls of negotiating through ECX coffee and its impact on small-scale farmers.
Learn coffee in Moscow
As is clear, ECX is not prepared to business operations of the entire complex, the choice of coffee exports. This partly explains why there ECX Run in trouble as soon as it started its coffee business.
ECX was originally designed to create a trading platform for domestic agricultural goods, especially degrees. ECX is designed with the purpose of removing archaic system of a market failure, as the founder of ECX, Elena Gebrs-Medhin, are partly responsible for the recurrent food shortages and famine in parts of Ethiopia, and increasing value of major household . Dr. Elena describes his vision in June 2007 in a TED Talk:
"Ethiopia on the domestic market is about $ 1 billion of values and way over the next five years, if Ethiopia can capture up to 40%, only 40 percent of the domestic market and 25% expected total value of this market, double the value market. ECX , moreover, becomes a platform for trade with the Pan-African market for agricultural goods. ethiopia agricultural market is 30 percent higher than South Africa, great production, and in fact, Ethiopia is the second largest producer of maize in Africa. "
Compulsory exchange
Demanding that 100% of the coffee trade to be conducted by ECX, the government abolished direct trade. The government says it has been necessary for the sector and prices. It is valueless.
Unlike grains, coffee trade is characterized by non-regulated supply, market monopoly by a few multinational companies, and fierce competition among producing countries. Coffee is a global commodity. It is the world's second most traded commodity next to oil prices are set to New York in exchange market. Trade is largely controlled by the world's largest coffee buyers. Five multinational company, Nestle, Philip Morris, Procter & Gamble, Sara Lee and Kraft Foods buys about 70% of global coffee and play a crucial role in setting prices in the world of coffee. Coffee-producing countries have no role in the unregulated world market.
Demanding that 100% of the coffee trade to be conducted by ECX, the government abolished direct trade. The government says it has been necessary for the sector and prices. It is valueless.
Unlike grains, coffee trade is characterized by non-regulated supply, market monopoly by a few multinational companies, and fierce competition among producing countries. Coffee is a global commodity. It is the world's second most traded commodity next to oil prices are set to New York in exchange market. Trade is largely controlled by the world's largest coffee buyers. Five multinational company, Nestle, Philip Morris, Procter & Gamble, Sara Lee and Kraft Foods buys about 70% of global coffee and play a crucial role in setting prices in the world of coffee. Coffee-producing countries have no role in the unregulated world market.
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