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The Hub Partners with EAGC to Support Staples Trade from Ethiopia surplus

Published on February 23, 2017

mini_maize_deal.JPGOn February 23, the Hub and the Eastern Africa Grain Council (EAGC) hosted a one-day “mini” trade mission at the Hub’s Nairobi office. Seven Ethiopian grain exporters met with 10 Kenyan buyers to initiate trade deals for Ethiopia’s surplus maize.  Beyond maize, the traders discussed the sale of soybeans, chickpeas and beans. Approximately 100,000 MT of various grains were discussed for trade at the business-to-business (B2B) meeting. 

The B2B meeting also served as a test case for finding solutions to payment mechanisms, logistics, trade finance and grading/quality. Though obvious trade partners, Ethiopia and Kenya do not have formal mechanisms in place for stable foods trade, particularly because Ethiopia is not a member of the East African Community (EAC) and until recently infrastructure was lacking. Efforts to remove various trader barriers are ongoing and will be addressed by the trade mission.  The Hub's support to the EAGC in facilitating the B2B trade mission is part of the Hub's work to promote regional trade in staple foods from surplus to deficit regions to help build an enduring market-based food security system.

Trade Attache, Ato Eshetu Yisma, represented the Ethiopian Embassy based in Kenya. The Addis Ababa Chamber of Commerce Board President, Ato Elias Geneti, who is also a pulses exporter, also attended.

The February 23 mini trade mission precedes a larger Hub/EAGC supported trade forum to take place on March 7 in Addis Ababa, Ethiopia. The March trade forum will bring together approximately 30 Ethiopian maize and other food staples sellers with approximately 40 maize buyers from Kenya, Tanzania, Uganda, Rwanda, Burundi, Mozambique, Zambia, Malawi and Zimbabwe. 

Background

The Ethiopian Agricultural Transformation Agency estimates over 1,000,000m MT of surplus white maize to be available for export, a record bumper maize harvest amid a regional drought that poses a major challenge to the region’s food security outlook.  To improve the flow of this staple crop across the region and mitigate the ongoing food crisis, the Hub is partnering with the EAGC to promote trade linkages while addressing larger regional trade policy issues. 

In 2016, an estimated 40 million people in eastern, southern and Central Africa faced hunger due to similar conditions. Maize in Ethiopia is not a staple food; it is sold as a cash crop. The revenue is used to supplement household nutrition. Hence, the successful trading of the surplus maize in Ethiopia improves the food security situation of Ethiopian farmers while also serving to mitigate the ongoing food crisis in eastern Africa.