Coffee is more than a cash export crop in Ethiopia, it is a national heritage. The discovery of coffee is traced back to the 3rd century legendary Ethiopian goatherd Kaldi who shared his discovery with monks who found that consuming the berries helped them stay awake during long hours of prayer. Hence when the actual discovery of coffee was made, it is undeniable that Ethiopia is at the heart and soul of coffee production. It is also one of the great world consumers of coffee, consuming an estimated 1.8 million bags per year (108,000 MT), out of a total annual production of about 4.3 million bags (258,000MT). Smallholders account for 90-95% of the annual production and the rest is grown on primarily government-owned plantations. Given the smallholder nature of production, and the consequent problems in accounting or production and consumption, figures remain estimates.
Although there are no longer any government restrictions on the pricing of Ethiopian coffee, allowing private sales directly to overseas buyers, the quality of all Ethiopian coffee exports is carefully monitored to ensure that exports are consistently of high standard. Barring a few recent exceptions, all Ethiopian coffee passes through auction (ECX) Ethiopian Commodity Exchange in Addis Ababa. All quality is controlled through the coffee liquoring unit (CLU) in Addis and Dire Dawa. The coffee is delivered by truck to the quality units, which are next door to the auction hall. Fully representative samples of washed and unwashed coffees are drawn directly from the trucks and then separated and dealt with by separate quality units. They are analyzed for defect count and cup, the ranked from class 1 to 4, or as rejects, before being displayed at auction all year round in both Addis Ababa and Dire Dawa (for the Harrar coffees). Lot sizes vary from about 60 bags to full container loads.
Once bought at auction (ECX), the coffee is delivered to the warehouse of the exporter who purchased it. Washed coffee is delivered as parchment, unwashed coffee as hulled green coffee. Exporters then have 24 hours after delivery to return the coffee if they find it does not match the sample and cup description given. Exporters complete the hulling (for washed coffee), grading, and hand sun-dried as Grade 4 or 5. All coffee areas, except Harrar where no coffee is washed, produce both washed and unwashed (sundried) coffees. In Harrar, this is due to a chronic shortage of water and the traditional preference of buyers for the sun-dried coffee. Elsewhere, farmers withhold sales of their coffee in order to stagger their sales, and thus their income, over a period of time. As fresh cherries cannot be stored, some cherries are sundried and stored to be delivered later, thus being processed and exported as naturals. Trees are of the Typica variety with some regional differences due to local development of strains suited to the variable soil and climate conditions.