Business

Railway upgrade could unleash Ethiopia’s produce export potential

Click here to view original web page at www.freshfruitportal.com

Print

E-Mail this Page

Ethiopian produce companies had their own country pavilion for the first time at this year's Fruit Logistica in Berlin, with crops ranging from grapes to strawberries to green beans.

Berhana Lodamo with some of the Ethiopian contingent at the fair.
Berhana Lodamo with some of the Ethiopian contingent at the fair.

Supported by Germany's Import Promotion Desk (IPD), there was an air of optimism at the stand ahead of the expected opening next year of a railway renewal project between Addis Ababa and the port of Djibouti.

"Ethiopia is a landlocked country, but the government has already established the development of a railway to the Djibouti port, and it will be commencing the transport of fruits and vegetables in reefer containers beginning from next year," said Berhano Lodamo of the Ethiopian Horticulture Producer Exporters Association (EHPEA).

"The government and the association are working together in order to have cold stores in every railway station so that growers will keep their products safe and in good condition."

"The fruits and vegetables we are exporting now include strawberries, beans, chillies and other crops shipped by Ethiopian Airlines cargo – otherwise you can’t transport watermelons, tomatoes, potatoes, different things like that because these are very bulky products," he said, adding there was also good potential for avocados and grapes.

While airfreight is expensive, Lodamo emphasized the cost of doing business in Ethiopia was cheap compared to other produce-exporting countries.

"For example you can have an abundant water resource, you can have a very young labor force, and the cost of doing business in Ethiopia is very cheap - electricity is cheap, land lease rates are cheap.

"Ethiopian Air cargo goes to different countries around the world, and we can go directly to destinations. This all gives Ethiopia the greatest opportunity for investment, as well as for the production of fruit."

He said the EHPEA worked with 110 companies that produced flowers, fruits, vegetables and herbs; flowers are still the leading component, but the fruit and vegetable industry is "coming up".

One agricultural company making the most of these opportunities is Luna Fruits Plc, based in Addis Ababa.

"We are the first commercial farm to start table grapes in Ethiopia. We started with about 10 hectares of the Flame Seedless variety," said operation manager Fitsumbirhan Kidane, adding the business began just seven years ago.

Luna Fruits operation manager Fitsumbirhan Kidane - sq
Fitsumbirhan Kidane

The group now plans to invest in 10 hectares of Red Globes, and is hoping to ship its fruit to Europe from Djibouti next year.

Initially the group was hoping to export in October and November, but this proved difficult as the period comes right after the wet season. Instead, the plan is to export during the dry months from November to May.

"By next year we’ll be operating from Djibouti because we had a very old railroad which was difficult, but now the railroad has been renovated and trains are running on it for a trial - by next year they will be fully operating," Kidane said.

"There will be a good opportunity to send it to Djibouti by rail, and then seafreight to Europe.

"Now we are exporting fresh fine beans, we are exporting sugar snaps and snowpeas, and we are on the way to exporting Indian and hot chillies," he said, mentioning the produce was exported to a British client."

He said he had received particular interest in the company's chillies from British buyers at the fair, and thanked IPD for its support as Ethiopian fruit and vegetable growers' "strongest link to the European market ".

Certifying an export future

Lodamo said the connection to the port of Djibouti could be a game-changer for the industry, but it was also very important that growers became certified with GlobalG.A.P. and other requirements needed for the European market.

"We are working hard on the quality of production as well because all the producers should get certifications – they have to produce quality production with regards to health, safety and environmental issues," he said.

Husam Al-Dakak
Husam Al-Dakak

"One of the activities the association is doing is certifying the farms, controlling the quality and the standards. We are giving training for personnel so they can reach the right standards of production."

"The association has a code of practice of its own for members - we give them training, and we tell them they have to abide by that. If you have the silver level of certification with the association, it means you are ready for GlobalG.A.P."

Import Promotion Desk's sourcing and purchase expert Husam Al-Dakak said the market for fresh products from Ethiopia was very young, and it was a "huge country with many green spaces".

"But there are only 17 GlobalG.A.P. certified growers in Ethiopia, in comparison to Tunisia where there are 270 GlobalG.A.P. certified growers and it’s one fifth of the size," he said.

"That’s why our main focus now as IPD is to work on this aspect, to get growers certified with GlobalG.A.P. as that’s a must with Germany and most European countries if they want to export.

"Our aim is to increase this number, focusing on products for the future coming by ship - in bananas for example there is great potential - there are no bananas exported now because of the logistics aspect but maybe this could be an interesting product - and avocados could be important, mangoes, etcetera."

He said the IPD began its activities in Ethiopia in January, 2015 and he visited the country on a fact-finding mission.

"We have chosen Ethiopia based on the demand in the Germany market, and given the development aspect policies from the German Government - we want to help Ethiopia, but also there is demand in the German market for fruits and vegetables, as well as cut flowers."

Comments

To Top