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Agri-Business Sector Ethiopia

The Agri-Business Sector in Ethiopia 2019

Alex Conradie | Ethiopia | 29 November 2019

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Report Coverage

This report on the Agri-Business Sector in Ethiopia examines the sector and its subsectors involved in the more than 140 different types of crops that are grown in the country. The report describes the size and state of the industry and the factors that influence it. There are profiles of 19 companies. These include the state-owned Ethiopian Sugar Corporation, the country’s only sugar producer and National Tobacco Enterprise, which has an out-grower scheme with more than 10,300 smallholder farmers. Other profiles include AQ Roses, which produces 15 rose varieties and Horizon Plantations, which owns the Bebeka coffee estate, one of the largest coffee plantations in the world.

Introduction

The agriculture, forestry and fishing sectors contributed 31.1% to Ethiopia’s gross domestic product (GDP) in 2018, and had a gross value added of US$26.2bn, according to World Bank data. Apart from its importance to the economy, the agricultural sector is also the most important sector from a socio-economic point of view, since it employed 33.7 million people, or 66.2% of the labour force, in 2018, according to the International Labour Organisation (ILO). Some of the challenges facing Ethiopia’s agri-business sector are its dependence on traditional farming methods and a rain-fed farming system, the high cost of production inputs, and high transportation costs.

Strengths

• A large number of different crops can be cultivated, because of the wide range of altitudes, a favourable climate and fertile land.
• Established agro-processing capacity.
• Ethiopia is an important producer of coffee, teff, sesame seed and flowers.
• Low-wage labour and cheap electricity available.
• Support for the sector from the government and international donor agencies.

Weaknesses

• A lack of available credit and land, since all land belongs to the government.
• Dependence on traditional farming methods and a rain-fed farming system.
• Most smallholder farmers cannot afford production inputs like improved seed, fertiliser and pesticides.

Opportunities

• Increasing demand for animal feed and processed food due to an increasing population and rising consumer incomes.
• Investment opportunities in integrated agro-processing industrial parks.

Threats

• Edible oil manufacturers face competition from palm oil imported and subsidised by the government.
• Frequent electricity outages.
• Poor transport infrastructure leads to high transportation costs.

Outlook

The World Bank forecasts the gross domestic product of the agricultural sector will grow by 4.0% in 2019, and by 4.5% in 2020, in real terms, while the US Department of Agriculture expects the production of barley, coffee, cotton, rapeseed and wheat to increase, and the output of maize, soya beans and sugar to decrease in the 2018/19 agricultural season. The production of millet and sorghum is forecast to remain constant from the previous season. According to the Organisation for Economic Co-operation and Development and the Food and Agriculture Organisation’s data, the production of sugar cane is expected to increase in the 2018/19 agricultural season, but the output of edible oil is forecast to decline. The US Department of Agriculture sees an increase in demand for animal feed, especially poultry feed, and for processed foods like edible oil, tahini, halva and confectionery, due to population growth and rising consumer incomes.

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The Agri-Business Sector in Ethiopia 2019

Full Report

R 1 900.00(ZAR) estimated $99.18 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 69.43 (USD)*

Table of Contents

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PAGE
1. INTRODUCTION 1
2. COUNTRY INFORMATION 1
2.1. Geographic Position 2
3. DESCRIPTION OF THE INDUSTRY 5
3.1. Industry Value Chain 10
4. SIZE OF THE INDUSTRY 16
5. STATE OF THE INDUSTRY 17
5.1. Local 17
5.1.1. Trade 27
5.1.2. Corporate Actions 31
5.1.3. Regulations 32
5.2. Continental 34
5.3. International 35
6. INFLUENCING FACTORS 36
6.1. Government Support 36
6.2. Foreign Aid 36
6.3. Economic Environment 37
6.4. Technology, Research and Development (R&D) and Innovation 37
6.5. Environmental Concerns 39
6.6. Labour 39
7. COMPETITION 40
7.1. Barriers to Entry 40
8. SWOT ANALYSIS 41
9. OUTLOOK 41
10. INDUSTRY ASSOCIATIONS 42
11. REFERENCES 42
11.1. Publications 42
11.2. Websites 43
APPENDIX 1 45
Summary of Notable Players 45
COMPANY PROFILES 49
ADDIS MODJO EDIBLE OIL COMPLEX S.C. 49
AH-WAN PLC 51
AHADU PLC 53
ALEMA KOUDIJS FEED PLC 55
AQ ROSES PLC 56
EAST AFRICAN AGRI-BUSINESS PLC 58
ELFORA AGRO-INDUSTRIES PLC 60
ETHIO AGRI-CEFT PLC 62
ETHIOPIAN SUGAR CORPORATION 64
HAMARESSA EDIBLE OIL S.C. 66
HORIZON PLANTATIONS PLC 68
KALITI FOOD S.C. 70
KEBIRE ENTERPRISES PLC 72
MELANGE COFFEE ROASTERS PLC 74
METAD AGRICULTURAL DEVELOPMENT PLC 76
NATIONAL TOBACCO ENTERPRISE (ETHIOPIA) S.C. 78
OLIRA AGRO INDUSTRY PLC 80
RAYA HORTI FARM 82
SHER ETHIOPIA PLC 84