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Eroded Coffee Traceability and Its Impact on Export Coffee Prices for Ethiopia

  • Leonard Leung

    (Department of Economics, Queen’s University, Canada)

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    In December 2008, the Ethiopian Commodity Exchange (ECX) opened a new coffee platform that has transformed Ethiopia’s coffee trade. The way ECX handles coffee in a commodity fashion has eroded traceability, a characteristic sought after by overseas coffee buyers. This paper traces the forces that give rise to the commoditization of coffee. An empirical analysis using a dataset on export coffee transactions supports the view that eroded traceability suppresses the export price of non-traceable, ECX-sourced coffee, relative to fully traceable coffee. The cumulative monetary is estimated to be 280 million USD, equivalent to 26% of farmer’ farm gate income from coffee.

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    File URL: http://www.queensjdiexec.org/publications/qed_dp_249.pdf
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    Paper provided by JDI Executive Programs in its series Development Discussion Papers with number 2014-04.

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    Length: 19 pages
    Date of creation: Feb 2014
    Date of revision:
    Handle: RePEc:qed:dpaper:249
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    1. Boansi, David & Crentsil, Christian, 2013. "Competitiveness and determinants of coffee exports, producer price and production for Ethiopia," MPRA Paper 48869, University Library of Munich, Germany.
    2. Aslihan Arslan & Christopher P. Reicher, 2010. "The Effects of the Coffee Trademarking Initiative and Starbucks Publicity on Export Prices of Ethiopian Coffee," Kiel Working Papers 1606, Kiel Institute for the World Economy.
    3. Worako, Tadesse Kumma & van Schalkwyk, Herman D. & Alemu, Zerihun Gudeta & Ayele, Gezahegn, 2008. "Producer price and price transmission in a deregulated Ethiopian coffee market," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 47(4), December.
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