progress in Ethiopia
The pixels had barely dried on my previous post before I received word from someone involved in the unfolding SCAA negotiations with the Ethiopian Commodity Exchange. The short of it is that there was solid reasoning behind keeping a low profile on the sensitive dialogue with the ECX, that significant progress was being made, and that the SCAA is striving to improve its public relations activities.
To that end, the SCAA blog shares some very positive news from Ethiopia about acceptance of a number of proposals that will advance the interests of quality coffee growers and buyers, including a proposed “2nd window” that will incorporate traceability and allow for premium prices paid directly to growers.
Direct Specialty Trade (DST) Platform: The ECX will also establish a 2nd window within its system, to allow for traceability and direct exchange. Within this system, any farmer or cooperative may submit their coffee to the ECX for quality evaluation and grading, and the coffee will be available for sampling to registered buyers. The ECX will then make available a venue for price discovery via an auction. ECX only facilitates the transaction, and is not a party to the transaction. A resulting FOB contract will be made directly between the overseas buyer and the farmer or farmer group, with the inclusion of a farmer-elected Services Provider, who may provide services to the farmer such as milling and exportation. The ECX will assist in the transaction by providing guidance on contracting and fee structure.
I encourage anyone interested in these complex issues to read the full report, detailing additional specialty level grading at the exchange using SCAA cupping protocols, proposed expansions of the ECX geographic indications, increases in the number of certified Q graders, and an overview of some of the underlying issues and remaining obstacles.
Tags: coffee, direct trade, ECX, Ethiopia, Ethiopia Commodity Exchange, SCAA
