Jacob Wilson and Hayley-Ann Vasco

1. Ethiopian Coffee
Jacob Wilson and Hayley-Ann Vasco

2. Background
• The Ethiopian economy is heavily dependent on the trade
of its primary products. Among the country’s limited
tradable goods, coffee alone generates about 60 percent
of Ethiopia’s total export earnings. Indeed, coffee is
closely tied to the culture and society of Ethiopia and an
estimated 15 million people are directly or indirectly
involved in the Ethiopian coffee industry. This African
nation enjoys a strong reputation for its heritage coffees
which command a very high retail price in the
international market. However, only 5 to 10 percent of the
retail price actually goes back to Ethiopia; most of the
profit is shared by distributors and middlemen in the
marketing sector. In wealthy countries, a cup of
cappuccino may be sold at US$ 4, but many coffee
growers in Ethiopia and other developing countries earn
less than a dollar a day.

3. Yirga Chefe
• This is a farm location for Ethiopian
coffee that is produced locally and
used by Starbucks in certain blends of
coffee that are becoming widely
popular today. Here they prepare the
bean, ferment and dry the bean, clean
the bean and sent it the next location
for further inspection and to be
packaged and cleaned. Here women
sign while sifting through beans and
drying them to ensure premium
quality.

4. Addis Ababa
• This is the second step of Ethiopian coffee, where the coffee goes
to be cleaned more, processed and packaged to make sure the
quality is premium before sending to Djibouti for shipment.

5. Djibouti
This is where the coffee that started at farms in Yirga Chefa
end up going, to the port to be shipped. Most of the coffee
here is already packaged by the thousands of pounds and
ready to be sent to the wholesalers.

6. Seattle, WA
• This is HQ of Starbucks where
coffee is regarded as currency
quite literally. This is where
people decide what is coming
in from Ethiopia and really
determine the profits these
farms in Yirga Chefe make
every year, they hold great
power in these countries
whose exports are coffee at
60% of all exports a year.

7. Lexington, KY
• Finally where our great University resides and we have the
privilege to walk out of our door every day and decide we want a
warm cup of Ethiopian coffee. The door at Starbucks might not be
a direct connection to the Yirga Chefe farms but we are a lot
closer than you'd ever think we are culturally and economically.

8. How is Ethiopia coffee doing today?
• “These changes have had marked positive results in terms of increased income
and improved living standards of the coffee producers. Prior to the IP protection
initiative, Ethiopia was receiving a scanty 6 percent of the final retail price for
its coffees. Against the average final retail price ranging from US$ 20 to 28 per
kilogram, the farmers were receiving as little as US$ 1 per kilogram. The
trademarking and licensing scheme immensely helped improve the situation:
Yirgacheffe farmers’ income doubled in 2007 in comparison with their income in
2006, with estimation that over the years the producers could secure their
income at around US $6-8 per kilogram. Overall, Ethiopia’s total coffee exports
are expected to reach the level of US $1.2-1.6 billion as opposed to a meager
US $400 million prior to the
Initiative.”(http://www.wipo.int/ipadvantage/en/details.jsp?id=2621) accordng
to many sources and media out there today I was able to find out that many
companies and even nations were taking advantage of these coffee farmers and
the whole country to buy them cheaper than what they were worth and causing
the nation and farmers to suffer losses and very low income but many pleaces
are trying to fix this problem and are succesfully changing the income these
farmers such as the ones in Yirga Chefe receive.

9. Who buys this product
• Most of the world enjoys coffee and this has been an amazing time
breaking product that has always been popular and has seen
skyrocketing popularity with companies such as Starbucks and
Dunkin Doughnuts making moves in the international markets and
making this a very easily accessible product.