Ethiopian Police Arrest Coffee Exporters for ‘Hoarding’ Beans

ethiopiancoffeeJune 15, 2009:  (Bloomberg) — Ethiopian police arrested and charged six managers from coffee exporting companies accused of “hoarding” the beans earlier this year, a manager with one of the companies said.

Representatives of each of the six companies were detained and taken to the federal police headquarters in Addis Ababa last week, more than two months after the government suspended their exporting licenses and seized 18,000 metric tons of coffee from their warehouses.

“Yes, it’s true,” said Yismashewa Seyoum, commercial manager of Seid Yassin Private Ltd. Co., one of the six companies, by phone from Addis Ababa today. “They were released on bail” and “spent only one night” in jail, he said.

The managers were detained on June 10, according to the Addis Ababa-based Fortune newspaper, which first reported the arrests. Demsash Hailu, spokesman for the federal police, declined to comment when contacted by phone today in Addis Ababa. Tarekea Tsiguey, spokesman for the Ministry of Agriculture, did not immediately return calls to his mobile phone.

Ethiopia suspended the exporters’ licenses after accusing them of hoarding coffee beans. The country has experienced shortages of foreign currency over the past year, Prime Minister Meles Zenawi said on March 19. The shortfall has led to rationing and shortages because companies can’t import goods or raw materials.

The government exported 10,361 tons of the seized coffee through the state-owned Ethiopian Grain Trade Enterprise, earning $21 million, the Walta Information Center said last week. The remaining coffee was sold to other private exporters on the Ethiopian Commodity Exchange, it said.

The six companies exported about 40 percent of the 170,888 tons of coffee shipped from the Horn of Africa country last year, according to data from the Ethiopian Coffee Exporters Association.

To contact the reporter on this story: Jason McLure in Addis Ababa via Johannesburg at pmrichardson@bloomberg.net