United Dairy Farmers December 2014 Andrew Thompson
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1 United Dairy Farmers December 2014 Andrew Thompson
2 RABDF 12 December 2014 Lisa Williams
3 IAgriM 22 December 2014 John Giles
4 ABS Northern Ireland December 2014 John Giles
5 Produce Business 18 December 2014 John Giles Ethiopia's processing industry: one to watch Ethiopia has often conjured up many negative images over the years. In a global agri-food sector that has been almost obsessed with developments in emerging markets, such as the so-called BRICs, Africa has gone almost unnoticed in comparison. Yet some of the current developments are staggering. Not least in Ethiopia, which is mainly known for its production and trade of coffee and sesame and, in recent years, of fresh vegetables and flowers to the EU and Middle East. Total fruit and vegetable production in the country is some 4.0 million tonnes per year, with most of this based around small holder production systems. Tomato production is still small at less than 100,000 tonnes/year, with an average national yield of just over seven tonnes per ha. On some of the more sophisticated farms, yields can reach up to tonnes, which is far more in line with major international origins. The fruit processing sector in Ethiopia per se is still under developed, with only one established fruit processing business based in the Upper Awash Valley. This was built in the 1970s by the East German government with Italian equipment installed, but in 2013 was acquired by a major Middle Eastern based investor. It supplies the domestic market only. There are no exports from Ethiopia at the moment. The prospects for future development look promising however. The Ethiopian economy has been growing rapidly in the last decade, with GDP growth rates of 7 10% per year. Investment is pouring into the country from sources including the EU, US, Saudi Arabia and China. This covers a range of activity, chiefly the physical infrastructure of road and rail systems. Incentives Agriculture and food processing are other major areas of investment. There are government incentives to provide investors with opportunities to invest in land, build factories and packhouses and import specialist equipment. Government plans to develop a number of food processing parks will be announced soon. With a population of around 90 million in a country twice the size of France, this presents a plethora of opportunities for both local market supply and potentially exports. Ethiopia enjoys excellent transport links to the Middle East Jeddah is two days' transit time from Djibouti, where most exports go from. The Middle East market for processed tomatoes has grown substantially over the last decade from just under 40,000 tonnes to nearly 150,000 tonnes. Saudi Arabia is the single largest market in the region at around 70,000 tonnes. Supply is dominated by China, Turkey, the US and EU exporters who account for 80% between them. Ethiopia can benefit from relatively low costs of labour and processing, its proximity to the Middle East market as well as strong cultural, economic and political connections. Continued
6 There is still much to do in terms of developing a processing sector in Ethiopia, but the sheer pace of change taking place in the country is impressive. Exports of processed tomato products are confined at the moment to some ad hoc business. One only has to look, however, at the development of exports of fresh vegetables and flowers to see what might happen in the future. Exports of vegetables have increased from 66,000 tonnes to over 170,000 tonnes between 2009/13 with a value now of some USD300 mln. Exports of flowers are now 41,000 tonnes/year. Ethiopia is now the fourth-largest flower exporter after Kenya, the Netherlands and India. The development of the processing sector in Ethiopia will take time, but the intent and potential is there. The country is definitely one to watch. John Giles, Divisional Director, Promar International, part of Genus plc.
7 The Chartered Institute of Marketing Food Drink and Agriculture Group 19 November 2014 James Dunn/John Giles Menu card from dinner at the House of Commons we sponsored
8
9 Fresh Produce Journal 19 December 2014 John Giles
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