World Sesame Outlook and Ethiopia’s position in the world market

C4C

Sesame Stakeholders Network Meeting

(April 20-21, 2015) Mekelle, Ethiopia, organized by

SBN & C4C/SNV, Agriterra/

World Sesame Production and ExportDescription Figure No producing countries 76Dominant countries Asia &AfricaProduction growth (2002-2012) 3.75 %Export growth (2002-2012) 6.10 %Share of export over production 25%-30%

World demand Increasing fast(>SS)

C4C

2008/09 2009/10 2010/11 2011/12 2012/13 2013/140

100000

200000

300000

400000

500000

600000

700000

Volume(MT) fob value ('000USD)

Ethiopia's Sesame traded volume and FOB value(2008/09-2013/14)

NO HUMERA TYPE WELLEGA TYPE1 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

Ethiopia’s Sesame seeds Characteristics

C4CCurrent 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

2-Jan-14

25-Jan-14

17-Feb-14

12-Mar-1

4

4-Apr-1

4

27-Apr-1

4

20-May-1

4

12-Jun-14

5-Jul-1

4

28-Jul-1

4

20-Aug-14

12-Sep-14

5-Oct-

14

28-Oct-

14

20-Nov-1

4

13-Dec-1

4

5-Jan-15

28-Jan-15

20-Feb-15

15-Mar-1

51000

1200

1400

1600

1800 Price in USD per MT

Ethiopia’s FOB price trend from Jan/2014 to March/2015

C4C2005-2015 Ethiopia Whitish Sesame CNF Price Trend in China

Sesame Price Trend Comparison for Domestic and Imported Sesame 2006-2015

C4CWhy Low Price??

2014/15 global Sesame production volume is beyond the expectation and the information from the consuming side could hardly make people optimistic

b. High & unexpected growth in production happened in most of the African countries:1. ETHIOPIA : 260-290 ; SUDAN : 60-1802. TANZANIA: 120-140; UGANDA :20-30;

MOZAMBIQUE 30-403. NIGERIA : 200-240; OTHER W.A :130-160

High Sesame Seed Price

Low demand and surplus for Low demand and surplus for Maize/Corn, Sugar, Cotton,

Soya etc.

a. Good Harvest in India & this resulted not to import from Africa

C4CWhy 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

C4CWill 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

Purchase or Continue to Wait & See.Rhythm

Lack of market confidence, keep sliding

more sesame shipments coming from Ethiopia, India, Togo, Sudan and Nigeria

most Chinese processors and millers have supplied their sesame STOCKS after Spring Festival,

processors are buying on current demand traders need to maintain the free flow of cash,

C4CHow Ethiopia responded to the Low Price??

Optimistic feeling persist

(high price)>140,000MT

in stock

Loose buyers, stock; loss; competitiveness

Domestic sesame buying price continue upward( higher than

world price):

e.g. On march 31/2015ECX Average price: 1267 USD/MT (and If you export 1500 USD/MT)

HoweverActual FOB Average price : 1374 USD/MT

High pressure on the International selling price will continue in thecoming months on contrary if the Indian and Tanzanian crop fails the

outcome will be the opposite

C4COPPORTUNITIES FOR ALL

Substitution effect.

End user consumption has been increased

keep the trade active & continued demand of sesame seed

.

-

JapanChina

C4COPPORTUNITIES FOR ETHIOPIA

presence of adequate land and inexpensive

labour

Well established brand :

quality sesame producer;

.

-

C4C

PRICE

QUALITY(world brand)

DELIVERY

COMPETITIVENESS OF ETHIOPIA ??

VOLUME( high)

Competitiveness

High

Varies with exporters

Poor Export Management

Limited long-term

contract

Individual quality defect result in bad

image on country’s market

B2B

Limited profiling & communication

100% comply with contractual arrangements

Trade is all about creating relationships & trust

Not speculate; high cost

Processors: big size, uniform &white

Unions have not utilized efficiently the ‘traceability’ & the direct export advantage over

common traders. Business arrangement

Bargain P

High cost of Production

Low productivity

CostProductivity

Info:world prod &marketing

Global sesame FOB price (March/2015)

Country Product Fob priceUSD/MT

CNF priceUSD/MT

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 Mixed sesame (2014-2015) 1240

White sesame (2014-2015) 1270

Price

2013/14 Top Ethiopian Sesame Destination Countries

61%15%

6%

4%

3%2%

2%2%1%1% 4%

% Share

ChinaIsraelTurkeyJordanSaudi ArabiaGreeceKorea, RepublicJapanLebanonEgyptOthers

83%

DiversificationChina???

India export to:Far East 41% and EU 20%

Far east(Korea PR29%, Vietnam 25% and chaina 4%)

C4CWORK FOR COUNTRY’S

COMPETITIVENESS

.

-Every Body should

work for the country's

competitiveness

How the SV

C

actors

can

generat

e

susta

inable

benefit??

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?

C4CISSUES FOR DISCUSSION

የመወያያ ጥያቄዋችችግር(issues) ምን

(what ?) ማን

(Who?)መቸ(when?)

1. ኢትዮÉ ያ 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

አ

ሰመ

ግ ና

ሁለ

THANK YOU