ETHIOPIA – Ethiopian coffee processing and brewing company, Haro Coffee, has diversified its business into production of disposable food and beverage packaging, investing Birr 20 million in development of a plant.
The facility, resting on 650Sqm piece of land is currently under construction and is expected to be operational in two months, creating job opportunities for 30 individuals, reports Addis Fortune.
Some of the products to be made at the plant will include paper cups, sugar sticks, drinking straws, bamboo stir sticks, and paper bags for takeaway service.
Haro will source its raw materials from Burayu Packaging & Printing Industry Plc, which produces carton boxes for packaging. It also supplies cake and egg trays; paper cones; labels; packets; calendars; paper tubes and other paper products.
The construction of the packaging plant was started four months ago, and currently installation of machinery imported from China at a cost of US$267,000 is taking place.
The packaging firm will have four types of machinery i.e. one that cuts paper sheets into different sizes and shapes, one for making the pieces into containers, one for packaging, and a printing machine dedicated to branding the products.
Other than producing packages, Halo also plans to provide labelling services to other food and beverage companies.
With the new venture, the coffee brewer will use the containers to market its own takeaway coffee at its three shops and other outlets at malls.
The company had been importing blank paper cups without branding from China and Dubai, and this encouraged them to initiate the idea of getting into the packaging business, says Nardos Mamuye, owner and CEO at Tsegona Manufacturing Plc, the parent company of Haro.
In addition to manufacturing its own packaging, it also has plans to start exporting ground coffee to the Middle East.
Authority relaxes coffee export restrictions
Meanwhile, coffee traders in Ethiopia can now send all grades of coffee beans to the global market, in contrast to the previous law that allowed them only to export the top four grades of coffee, according to a new directive issued by the Ethiopian Coffee & Tea Authority.
In addition, farmers and exporters can also directly ship the beans without going through the trading floors of the Ethiopian Commodity Exchange (ECX).
Under the new scheme, coffee quality experts at respective regional offices of the Authority will determine the grade of the coffee prior to exporting and set prices.
The change is aimed at boosting export volume and foreign currency earnings, according to Hairu Nuru, market information & regulatory director at the Authority, targeting the commodity to bring in US$1.7 billion from the export of 312,000tn of coffee this year.
In the past fiscal year, the exported 271,000tn of coffee generated US$ 854 million, over one-fourth of the total export earnings of the country.
“There is a demand even for the lowest Ethiopian coffee grades in the international market. We’ve been receiving repeated calls from exporters,” said Hairu.
In a country that has 418 licensed exporters, 5.5 million household growers, and is known to be the origin of coffee, the commodity has not been benefiting the economy as much as expected.
This is due to quality problems arising from poor inspection prior to export and presence of a long and tedious trading processes brough by presence of multiple middle men who led to the price of the commodity to skyrocket and delayed trade.
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