The Ethiopia Commodity Exchange announced the official launch of its IBM-enabled national traceability system, known as eATTS. The system, which will start by piloting coffee in the current harvest season, is expected to increase exports of high-quality Ethiopian coffee world-wide and enhance market access for specialty coffee from Ethiopia.
The traceability initiative is led and owned by ECX, which contributed $1.4 million USD toward the total project cost of $4.5 million USD. The project came to fruition in collaboration with USAID, which contributed $1.8 million under its Agribusiness Market Development activity, and Nestle, Jacobs Douwe Egberts (JDE), Mother Parker’s Coffee & Tea and The Sustainable Trade Initiative (IDH), who jointly contributed $1.3 million through the Sustainable Coffee Program.
“USAID has been supporting the coffee industry in Ethiopia, from farm-gate to final market, for many years. We are very excited about the launch of this innovative, multi-stakeholder traceability initiative that marries market development and ground-break technology to meet international demands and strengthen the entire value chain,” according to Dennis Weller, Mission Director of USAID Ethiopia.
The new tagging system links bags of coffee traded through the ECX to one of over 2500 geo-referenced washing, hulling and cleaning stations located in Ethiopia’s southern, central and western coffee growing regions. Each tag’s embedded information includes photos of the station as well as names and contact information for the station manager.
“True traceability goes beyond the commodity’s type or origin to tracing where the commodity has been. We wish to track the footprint of our coffee and where and when it was washed, stored, who sampled and graded it, and when it was shipped. All of these facts will help improve our ability to move commodities traded within the exchange and create premium value for all stakeholders in the value chain,” explained ECX CEO, Ermias Eshetu.
Buyers of commodities have become more discerning and willing to pay for quality, environmentally-friendly and origin-specific commodities. Additionally, international buyers demand transparency and accountability within supply chains, so as to ensure the quality, consistency and safety of their products. To meet these demands, ECX and partners are implementing a wide array of activities, including electronic tracking of bags, innovations in washing and processing, and streamlined storage and transportation processes.
“The traceability system will utilize IBM’s powerful cloud platform, analytics and mobile to provide ECX with continuous real-time data insights that enable the system to learn and predict the quality of Ethiopian coffee based on local growth and processing conditions.” said IBM General Manager for East Africa, Nik Nesbitt. “The system will analyze incoming client coffee quality needs and match that with the needs of buyers across the globe.”
Improvements in sustainability and traceability incentivize farmers to use the best techniques to grow and harvest different commodities. Innovations in processing stations and ECX laboratories also guarantee world best practice methods are used to grade and certify commodities before they are traded on the ECX platform.
As Linda Butler, coffee sustainability manager at Nestlé, stated, “Nestlé welcomes this key development toward a successful future for the whole of the Ethiopian coffee industry, from farmers to exporters. Supply chain transparency, the foundation which sustainability is built upon, will enable consumers all around the world to learn more about this great coffee producing nation, farmers to be rewarded for excellence in coffee quality, and roasters like us to collaborate in a meaningful way with farmers and key partners to increase productivity, efficiency, quality, social and environmental conditions, building together better living conditions in coffee communities.”
Improvements in sustainability and traceability incentivize farmers to use the best techniques to grow and harvest coffee. Innovations in processing stations and ECX laboratories also guarantee the latest methods are used to grade the beans before being sold on the ECX platform.
The ECX traceability is the world’s first nationally owned system, and will soon cover all of Ethiopia’s coffee growing regions, which encompass over 5 million smallholder farmers. The traceability system will be in place for this year’s coffee harvest, opening a new chapter in Ethiopia’s fabled coffee history.
The Ethiopia Commodity Exchange (ECX) is a new initiative for Ethiopia and the first of its kind in Africa. The vision of ECX is to revolutionize Ethiopia’s tradition bound agriculture through creating a new marketplace that serves all market actors, from farmers to traders to processors to exporters to consumers. The ECX is a unique partnership of market actors, the Members of the Exchange, and its main promoter, the Government of Ethiopia. ECX represents the future of Ethiopia, bringing integrity, security, and efficiency to the market. For more information, visit: www.ecx.com.et
The USAID Agribusiness Market Development Program is the Feed the Future initiative’s flagship program in Ethiopia and represents one of USAID’s largest contributions to the Government of Ethiopia‘s Agricultural Growth Program. The $3.5 billion global hunger and food security initiative sustains the U.S. Government’s commitment as one of Ethiopia’s largest partners in developing the agriculture sector, which is a fundamental cornerstone of the Ethiopian economy. For more information, visit: www.usaid.gov/ethiopia
The Sustainable Coffee Program, powered by The Sustainable Trade Initiative (IDH), is a global, pre-competitive, public private initiative. The program convenes industry and trade partners, producers, (local) governments and research institutions, donors, NGOs and standard setting organizations in the coffee sector. The ambition is to help bring global sustainable coffee production and sourcing practices to scale, by aligning stakeholder investments in producer support programs, to improve farmer livelihoods while preserving natural resources and enabling coffee producers to become more resilient in an ever-changing market. For more information, visit: www.sustainablecoffeeprogram.com