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/ C4C World Sesame Production and Export Description Figure No producing countries 76 Dominant countries Asia &Africa Production growth (2002-2012) 3.75 % Export growth 6.10 % (2002-2012) C4C Share of export over production 25%-30% World demand Increasing fast(>SS) 700000 Ethiopia's Sesame traded volume and FOB value (2008/09-2013/14) 600000 500000 400000 300000 200000 100000 0 2008/09 2009/10 2010/11 Volume(MT) 2011/12 fob value ('000USD) 2012/13 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 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 1800 1600 1400 1200 1000 Price in USD per MT C4C 2005-2015 Ethiopia Whitish Sesame CNF Price Trend in China C4C Sesame Price Trend Comparison for Domestic and Imported Sesame 2006-2015 C4C 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: 1. ETHIOPIA : 260-290 ; SUDAN : 60-180 2. TANZANIA: 120-140; UGANDA :20-30; MOZAMBIQUE 30-40 3. NIGERIA : 200-240; OTHER W.A :130-160 Low demand and surplus for Low demand and surplus for Maize/Corn, Sugar, Cotton, Soya etc. C4C 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 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 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 traders need to maintain the free flow of cash, processors are buying on current demand Lack of market confidence, keep sliding Rhythm Purchase or Continue to Wait & See. C4C Optimistic feeling persist (high price) >140,000MT in stock Domestic sesame buying price continue upward( higher than world price): 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 will bestock; the opposite Looseoutcome buyers, loss; competitiveness OPPORTUNITIES FOR ALL . - China Japan End user consumption has been increased Substitution effect. keep the trade active & continued demand of sesame seed C4C OPPORTUNITIES FOR ETHIOPIA . - Well established brand : quality sesame producer; presence of adequate land and inexpensive labour C4C C4C COMPETITIVENESS OF ETHIOPIA ?? Not speculate; high cost Bargain P Info:world prod &marketing Business arrangement High PRICE Limited longterm contract 100% comply with contractual arrangements Unions have not utilized efficiently the ‘traceability’ & the direct export advantage over common traders. DELIVERY Poor Export Management High cost of Production VOLUME ( high) Competitiveness Processors: big size, Individual uniform &white quality defect result QUALITY in bad image (world brand) on country’s market Varies with exporters Low productivity Cost Productivity B2B Limited profiling & communication Trade is all about creating relationships & trust Global sesame FOB price (March/2015) Product Ethiopia First-grade sesame (2014-2015) from 1470 direct suppliers Second-grade sesame (2014-2015) 1370 from direct suppliers White sesame (2014-2015 seasons Sudan India Nigeria Mali Burkina Faso New white sesame (2014-2015) Nigeria oilseed (2014-2015) Mixed sesame (2014-2015) Mixed sesame (2014-2015) White sesame (2014-2015) Fob price CNF price USD/MT USD/MT 1430 1500 1240 1230 1240 1270 rem ark Shipment date in Apr. Price Country 2013/14 Top Ethiopian Sesame Destination Countries % Share Diversification China??? China 83% 1% 4% 1%1% 2% 2% Israel Turkey 3% 4% Jordan 6% Saudi Arabia Greece Korea, Republic 15% 61% Japan Lebanon Egypt Others India export to: Far East 41% and EU 20% Far east(Korea PR29%, Vietnam 25% and chaina 4%) WORK FOR COUNTRY’S COMPETITIVENESS . - C4C C4C ISSUES FOR DISCUSSION 1. How can Ethiopia position itself better in the world market? Including market diversification to EU? 2. How cooperatives/unions become efficient & effective Market player? 3. Up to what level quality of sesame improved? How? የመወያያ ጥያቄዋች ችግር(issues) 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? ምን (what ?) ማን (Who?) መቸ (when?) መ አ C4C ግ ሰ ና THANK YOU ለ ሁ