The first white flowers are starting to appear on the branches of Habtamu Wolde’s coffee bushes in the Kafa region of southwest Ethiopia. They will bloom several more times before turning into round red cherries ready for harvesting in October. Then they will be prepared for export and shipped to the capital.
“Our coffee is iconic, you cannot find a higher grade,” boasts Habtamu. Coffee is more than a drink in Kafa. This region claims to be the birthplace of Arabica coffee, which grows naturally in its temperate cloud forests. The plant is at the centre of daily life and the people’s main source of income.
“Coffee is part of the Kafa people’s identity,” says Habtamu, from his eight-hectare (20-acre) plantation. “We would not survive without it.”
Coffee is Ethiopia’s biggest export – comprising about a third of export earnings – and the main source of foreign currency. The European Union is the biggest market, taking more than 30% of Ethiopia’s beans. In Kafa, 80% of the beans produced go to Germany.
Across Ethiopia, 5 million smallholders depend on growing coffee. Another 10 million workers wash, process and transport the beans. The industry has boomed in recent years, helping drive Ethiopia’s economic growth. But producers say it is at risk from new European legislation – the EU Regulation on Deforestation-free Products (EUDR) – due to come into force in 2025.
The EUDR bans the sale of coffee, rubber, cocoa and other products if companies cannot prove that it did not come from deforested land. Environmentalists have hailed it as an historic achievement.
Yet Ethiopia’s coffee industry claims the new rules are unfair since almost all Ethiopia’s coffee is grown by poor farmers who own small plots of land and lack the expertise to gather the complex data needed to show compliance.
“The EUDR changes everything,” says Abebe Megnecto, the manager of Kafa’s coffee union, which represents 13,676 local farmers. “Meeting the criteria requires a lot of technology and manpower that we simply don’t have.”
Abebe and other Ethiopian coffee officials argue that their beans are more sustainable than those from other big producers, such as Brazil, where most coffee plantations are vast monocultures cut from the jungle, sustained by fertiliser and devoid of trees.
By contrast, Ethiopia’s coffee farming relies on maintaining forests and the shade they provide, which protects coffee plants from the heat. The beans are grown by smallholders who on average cultivate less than two hectares of land. Abebe says: “Our way of growing coffee is far less damaging.”
Nonetheless, orders are already slowing from European buyers, who face fines of up to 4% of their turnover if they bring non-compliant products into the EU.
“Buyers are hesitating to buy our coffee because they are not confident we can demonstrate compliance,” says Tsegaye Anebo, manager of the coffee farmers union in Sidama, about 150 miles east of Kafa. “We are thinking of diversifying to other markets, but that will take years. It’s not simple.”
Felix Ahlers, founder of Solino, a German company that imports 200 tonnes of roasted Ethiopian beans a year, says its business model could become unsustainable.
“At the moment we don’t have a solution,” he says. “We’re hoping we’ll find one, but it’s not clear how we can keep importing.”
Few farmers in Kafa have even heard of EUDR. But they are confident they would comply given the chance.
“We are not destroying the forest, because we know growing coffee without the forest is impossible,” says Habtamu.
The coffee plants on his farm are interspersed with towering fig trees, poplars and palms, as well as wild pepper and cardamom. Habtamu estimates he has planted 2,000 trees over the past three decades to create shade for coffee plants on degraded land previously used to grow maize or graze cows.
Many farmers in Kafa support anti-deforestation rules. Mekonnen Utta, 76, who owns a 1.5-hectare (3.5-acre) farm that yields about 10,000 Ethiopian birr (£140) of coffee each year – his only source of income – says: “We need the forest, not just for our incomes, but for our health. If these rules protect the forest, that’s good, but everyone should be made aware of them so they can comply.”
There are fears the cost of compliance could make Ethiopia’s coffee uncompetitive due to its heavy reliance on smallholders. The country’s supply chains are fragmented, involving several brokers, and a single shipment of coffee to Europe can include beans from thousands of farmers.
“In places like Brazil it’s easy to drive around on a quad bike and gather the data needed for EUDR,” says an executive at a large trading company importing Ethiopian coffee to Europe. “In Ethiopia, you would need to map all these very small farms individually. That’s going to be incredibly expensive.”
Even though the EUDR resembles a “bit of a sledgehammer”, the move away from voluntary eco-friendly schemes to compulsory regulations is still positive, says Mike Senior, of Proforest. Products consumed by the EU cause about 10% of global deforestation.
Even in Kafa, where the forests are vital to the local economy, trees are being cut to make way for coffee plants, says Asaye Alemayehu, the local office head of Nabu, a German environmental group.
That is because coffee is being planted in pristine patches of forest, not just old pasture land. “You need to cut down about 70% of the trees to let enough light in for the coffee plants,” says Asaye. “If you have 100% coverage, they’re not productive.”
An EU spokesperson said extensive consultations were held before EUDR’s introduction and that support is on offer for smallholders. Nonetheless, Ethiopia is asking for more time. Cocoa producers in Ghana and Ivory Coast and palm-oil-producing Indonesia also want a delay.
“This coffee helps build schools, health centres, roads,” says Abebe from the Kafa coffee union. “Without the European market, we will lose all of this.”
