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Saturday, November 28, 2009

ECX announced its trading of Specialty coffee for the first time


The article below is good news and a positive sign that ECX is attempting to accommodate Specialty coffee trading on its platform. It should be noted, however, that the change that is publicized in the news article only addresses the quality aspect of the Specialty coffee trade requirements. Meaning, the coffees traded as Specialty coffee are termed as such only because the beans had met the minimum quality criteria set by the SCAA. Currently, single origin coffee trade is not supported by ECX's system as ECX is not ready to ensure traceability of coffee beans to origins. Officials at ECX mentioned that they are still working on what is termed "the second window" which will accomodate the trading of all Specialty coffees.


Another observation in the news article is that it does not mention whether ECX's trading of the Specialty coffee had fetched premium prices to the country, exporters, or coffee growers. Were the closing prices for the Specialty coffee higher than those for the other export-grade coffee stocks? This is worth looking into in light of the impending question of whether the trading of Specialty coffees on a commodity exchange platform is a move forward or backward.
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Ethiopia launches first ever specialty coffee trading

APA-Addis Ababa (Ethiopia)

November 26, 2009

The Ethiopia Commodity Exchange (ECX) announced on Thursday in Addis Ababa the launching of specialty coffee trading in the country.

The ECX specialty trading system relies on “Q”grading, an internationally recognized specialty classification developed by the Specialty Coffee Association of America (SCAA).

Accordingly, ECX becomes the only commodity exchange in the world to trade specialty grade coffees, also making Ethiopia the first coffee producing country to create a system to grade arrival (or domestic) coffees using the Q system, and doing so in regions of origin.

“Today a large number of excited buyers and suppliers were present to witness the historic occasion, as 16,200kgs of Arrival Q1 and Q2 grade coffees from Sidama region, graded and stored in the ECX Hawassa regional centre, were sold on the first day,” said ECX.

Coffee is Ethiopia’s main foreign earning, generating over US$ 500 million annually since the past few years.

“Today, we have put Ethiopia on the map as having one of the most refined domestic specialty coffee classification and discovery systems in the world,” Dr. Eleni Gabre-Madhin, Chief Executive Officer of ECX.

The ECX specialty handling is designed to benefit the millions of small-scale producers who have little knowledge of the value of the premium beans.

Ethiopia, known as the birth place of coffee, is Africa’s top exporter of coffee to the international market.

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