Generating exposure to international sesame markets

Generating exposure to international sesame markets

SNV Ethiopia’s Co-operatives for Change (C4C) project supports co-ops and potential buyers to establish and develop market linkages, and introducing cooperatives to trade conferences is one important route. Achenef and Metema Co-operative Union Manager, Guadie Mikaelie talks about the key takeaways from his first attendance at the China Conference on Sesame and Sesame Products.

“Trade is all about creating trust, credibility and relationships, and about compliance with product quality specifications and timely deliveries. Minor mistakes without good relationships can lead to losing existing buyers and can impact whether you can get new ones. We found that meeting potential buyers and processors in person can go a long way in helping us develop better relationships so we can then talk about how we can do business together.”
Selam Co-operative Union Manager, Tilahun Achenef.

Sesame seeds are big business in Ethiopia. In less than a decade, the country has jumped from being a minor producer (38,000 tonnes in 2002, according to the UN's Food and Agriculture Organisation) to the largest producer in Africa and fourth largest in the world (320,000 tonnes in 2011, according to the most recent data available). Sesame seed exports rank second, behind coffee, for Ethiopia. During the same period, China has switched from being a net exporter to a net importer, providing the main destination for Ethiopia's sesame seeds.

“One point that impressed both of us, as well as the Chinese buyers and processors, was the fact that we were there and are capable of supplying sesame seeds directly. We also could show samples of our seeds and explain our experience in ensuring traceability of our product. Everyone seemed pleasantly surprised to see new faces representing farmer organisations that are ready develop serious partnerships in business.” Achenef and Metema Co-operative Union Manager, Guadie Mikaelie.

Tilahun and Guadie met with two of China’s major processors, namely Ruifu Sesame Oil Co. and ETG (Tianjin) Cereals & Oil Co. Ruifu owns established sesame oil brand 'Cuizi'. Sesame oil is considered by Chinese consumers as “the king of vegetable oil’’ and as one of the three best edible oils by the World Health Organisation.

ETG (Tianjin) has worked with American-based Archer-Daniels-Midland and others to set up Northern China’s largest sesame manufacturing plant. ETG is Africa's largest integrated, multi-national agriculture, trade, and processing organisation, incorporating sesame plantings, processing, storage, transportation, and integration along the supply chain.

The managers agreed, adding that their co-operatives and others in Ethiopia need to focus on improving their communication with potential buyers and processors to build relationships and trust; ensure 100 per cent compliance with contractual agreements; and analyse better the global supply and demand situation to ensure smallholder farmers and their co-operatives are competitively priced in the marketplace.

Cooperatives 4 Change program is matchfunded by BMGF and Agriterra and implemented by SNV Ethiopia and Agriterra.