World Sesame Outlook and Ethiopia’s position in the world market C4C World Sesame Outlook and Ethiopia’s position in the world market Sesame Stakeholders Network Meeting (April 20-21, 2015) Mekelle, Ethiopia, organized by SBN & C4C/SNV, Agriterra/

World Sesame Production and Export Description Figure No producing countries 76 Dominant countries Asia &Africa Production growth (2002-2012) 3.75 % Export growth (2002-2012) 6.10 % Share of export over production 25%-30% World demand Increasing fast(>SS) C4C Ethiopia's Sesame traded volume and FOB value (2008/09-2013/14)

Ethiopia’s Sesame seeds Characteristics NO HUMERA TYPE WELLEGA TYPE 1 Appreciated for its aroma and sweet taste mainly used in raw form because of their aesthetic value 2 Whitish color White seeds, with a white to golden colour 3 larger seeds size; Small seeds 4 Good uniform seeds 5 48 – 50% oil content High oil content 49 -56% 6 Used for bakery products, Tahinia confectionary Seeds crushed into oil

Current sesame market dynamics C4C 2. The prices of sesame seeds has been dropped compared to 2014 Global From 2200 USD to 1200 USD/MT Ethiopia From 2600 USD to <1400 USD/MT Ethiopia’s FOB price trend from Jan/2014 to March/2015 Indicative export qty in 000MT South America 50-60 OTHERS 20 INDIA 250-270 PAKISTAN 25-30 MYANMAR 150-175

2005-2015 Ethiopia Whitish Sesame CNF Price Trend in China C4C Sesame Price Trend Comparison for Domestic and Imported Sesame 2006-2015 Indicative export qty in 000MT South America 50-60 OTHERS 20 INDIA 250-270 PAKISTAN 25-30 MYANMAR 150-175

C4C Why Low Price?? a. Good Harvest in India & this resulted not to import from Africa 2014/15 global Sesame production volume is beyond the expectation and the information from the consuming side could hardly make people optimistic High Sesame Seed Price b. High & unexpected growth in production happened in most of the African countries: ETHIOPIA : 260-290 ; SUDAN : 60-180 TANZANIA: 120-140; UGANDA :20-30; MOZAMBIQUE 30-40 NIGERIA : 200-240; OTHER W.A :130-160 INDIA 250-270 PAKISTAN 25-30 MYANMAR 150-175 Low demand and surplus for Low demand and surplus for Maize/Corn, Sugar, Cotton, Soya etc.

3. Poor quality of Ethiopia’s Sesame compared to previous years C4C Why Low Price COND----?? 2. a month of delays in the harvest & marketing of India sesame, together with the concentrated harvest and marketing of sesame in East and West African 3. Poor quality of Ethiopia’s Sesame compared to previous years 4. Sesame seeds with 50-54% Oil at price of $1200/MTs is still in better position

Will the Low Price Continue in China?? most Chinese processors and millers have supplied their sesame STOCKS after Spring Festival, more sesame shipments coming from Ethiopia, India, Togo, Sudan and Nigeria C4C Will the Low Price Continue in China?? after the Spring Festival, prices continue to "decline on the slide", market remain be weak in the short term In china in April , 2015, the phenomenon of supply exceeds demand will be the same as before. However, the overseas sesame price has reached an extremely cheap level after four months of sharp decline processors are buying on current demand traders need to maintain the free flow of cash, Lack of market confidence, keep sliding Rhythm Purchase or Continue to Wait & See.

How Ethiopia responded to the Low Price?? C4C How Ethiopia responded to the Low Price?? Domestic sesame buying price continue upward( higher than world price): Optimistic feeling persist (high price) >140,000MT in stock e.g. On march 31/2015 ECX Average price: 1267 USD/MT (and If you export 1500 USD/MT) However Actual FOB Average price : 1374 USD/MT High pressure on the International selling price will continue in the coming months on contrary if the Indian and Tanzanian crop fails the outcome will be the opposite Loose buyers, stock; loss; competitiveness

C4C OPPORTUNITIES FOR ALL China Japan End user consumption has been increased - . Substitution effect. keep the trade active & continued demand of sesame seed

OPPORTUNITIES FOR ETHIOPIA C4C OPPORTUNITIES FOR ETHIOPIA Well established brand : quality sesame producer; - presence of adequate land and inexpensive labour .

COMPETITIVENESS OF ETHIOPIA ?? C4C COMPETITIVENESS OF ETHIOPIA ?? Not speculate; high cost 100% comply with contractual arrangements PRICE High DELIVERY Bargain P Unions have not utilized efficiently the ‘traceability’ & the direct export advantage over common traders. Info:world prod &marketing Limited long-term contract Poor Export Management Competitiveness Business arrangement VOLUME ( high) High cost of Production Cost Productivity Individual quality defect result in bad image on country’s market QUALITY (world brand) Processors: big size, uniform &white B2B Low productivity Limited profiling & communication Varies with exporters Trade is all about creating relationships & trust

Global sesame FOB price (March/2015) Country Product Fob price USD/MT CNF price remark Ethiopia First-grade sesame (2014-2015) from direct suppliers 1470    Shipment date in Apr. Second-grade sesame (2014-2015) from direct suppliers 1370   Sudan White sesame (2014-2015 seasons 1430   India New white sesame (2014-2015) 1500  Nigeria Nigeria oilseed (2014-2015) 1240   Mali  Mixed sesame (2014-2015)  1230  Burkina Faso White sesame (2014-2015)  1270 

2013/14 Top Ethiopian Sesame Destination Countries India export to: Far East 41% and EU 20% Far east(Korea PR29%, Vietnam 25% and chaina 4%)

WORK FOR COUNTRY’S COMPETITIVENESS C4C How the SVC actors can generate sustainable benefit?? - Every Body should work for the country's competitiveness .

C4C ISSUES FOR DISCUSSION How can Ethiopia position itself better in the world market? Including market diversification to EU? How cooperatives/unions become efficient & effective Market player? Up to what level quality of sesame improved? How?

የመወያያ ጥያቄዋች ችግር(issues) ምን (what ?) ማን (Who?) መቸ (when?) 1. ኢትዮÉያ በአለም የሰሊጥ ገበያ ላይ ጥሩ ተፎካካሪ እንድትሆን ምን መደረግ ይሮርበታል ? የወጭ ንግድ መዳረሻ ሀገሮችን ወደ አዉሮፓ ሀገሮች ለማበራከት እንዴት ይቻላል? 2. ህብረት ስራ ማህበራትና ዮኔኖች በሰሊጥ ግብይቱ ብቁና ዉጤታማ ተወናዋይ እንዲሆኑ ምን መሆን አለበት 3. የሰሊጥን ጥራት በምን መልኩና በምን ደረጃ ማሻሻል ይቻላል?

C4C ግ ሰ ና መ ለ አ ሁ THANK YOU