Coffee Value Chain Case Study

Stakeholders play different important roles within the coffee value chain. There are about nine actors involved within the coffee value chain and eight supporters identified. The actors fully participate in the chain and fully responsible for the chain at different levels within a chain based on their functions. Supporters are not within a chain and implement the chain rather they play the facilitation or technical support to the chain actors at different levels. From producers, there are two main coffee collection ways used, through local collectors and wholesalers. Local collectors based in the community collected more than 65% of the coffee produced from farmers than wholesalers. Because the local collectors travelled to the remote area
There are no contractual agreements between farmers and buyers. The existing relationship among farmers and coffee buyers is more of informal which focuses on the selling and buying of coffee during the cropping seasons only with farmers. Due to weak relationships among the actors within the chain, access to market information is difficult. KIT and IIRR (2008) stated that weak chain relationship contributed to low-quality product supply by
The collector’s costs about two Ethiopian Birr during the marketing process and wholesaler’s costs nearest to ten Ethiopian Birr per kilogram from local to the export levels. The selling price for farmers indicated that there is a slight difference between collectors and wholesalers.

This analysis supported by Ali (2013) stated that the sales price of the farmers at the farm gate price shows 82 Ethiopian Birr per one kilogram, which is higher than the farm gate price farmers are getting in the study area. The cost price calculation demonstrates that farmers in the study area expend twelve Ethiopian Birr to produce one kilogram of coffee. According to Ali (2013) the farmers in the Meta district, Harar expends twenty Ethiopian Birr per one kilogram of coffee production. Here the cost shows higher because of the marketing costs the farmers incurred to supply to the nearby market is higher than the study area.

Farmers value share during the process higher in the chain of wholesalers than local collectors chain. This is because collectors purchased in the remote area which incurs higher transportation costs, while the wholesalers purchased with the commission agent at the roadside at the mini shops.

5.3: Hindering and supporting