A study case on coffee (Coffea arabica): Limu Coffe - IRD

Akhrabies represent a homogeneous class of traders and grocers having accumulated
capital to invest on processing plants and warehouses even if their means vary from one to
another. Whereas cooperatives are more heterogeneous: only two of thirteen possess
processing plants and export coffee through the OCFCU; the eleven remaining are not so
active and don’t really influence smallholders’ activities. In this way, akhrabies concentrate
the bulk of the coffee production and are the main processors. For example, the Limu Inara
Multi-Purpose Farmers Union rents its hullery from an akhrabie which plant is located in
Limu Genet. Thus akhrabies are more vertically integrated in production process, even in
central and export market linkages. This akhrabie for example exports coffee he produces in
its own farm under the name: Limu Special 3 selling it to Travocca Company import agent in
Addis Abeba.
Who will be the main beneficiaries of a GI protection? Firms of investors and PLC
may attempt to pursue to vertically integrate while akhrabies may continue to buy coffee at
the same prices through sebsabies that smallholders easily point out as exploiters.
Moreover, these local actors have to contend with the economic power of various
intermediaries to reach the market that includes foreign distributors, roasters and retailers as
Nestlé, Kraft Food, Carrefour, etc. In the <strong>case</strong> of coffee, a handful of processing companies
control a very large part of global trade, more problematically in the retail market which is
very concentrate. Therefore, higher demands for product standardisation might threaten the
distinctiveness of the GI.
Trade restriction
Will the application of GI rules restrict trade? Nowadays, Limu coffee is among the
nine Ethiopian cup profiles and is daily traded through the Ethiopia Commodity Exchange.
What will happen to the coffee currently sold as Limu coffee originated in Bedelle, Loppa,
Chorra, Yayu and Alididu Dedessa out of the Limu region we described for this <strong>study</strong> <strong>case</strong>?
What will be the consequences for their producers which coffee is currently exported as
Limu-2?
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