The landscape of shipping coffee from East African ports to the United States has always had its obstacles. These days, the combination of geopolitical tensions in the Red Sea/Gulf of Aden, infrastructure limitations, and equipment shortages has created a situation that makes it increasingly difficult and expensive to get East African coffee to market. In this logistics update, Andrew Blyth shares important information about container shipments, delays, and what to do moving forward.
Updates on Shipping Coffee from East Africa
Recently, there have been many reports in the coffee industry regarding these logistical challenges. The focus has largely been on Ethiopia and Djibouti, the country where Ethiopian coffees export. Ethiopia has some of the world’s most coveted coffee-growing regions, varieties, and cup profiles that many specialty roasters rely on, and it’s difficult to replicate these unique characteristics. However, the challenges Ethiopian exporters are facing are not due to the popularity of Ethiopian coffee in the specialty market. Rather, these difficulties stem from their export season coinciding with many of the current challenges facing international ocean freight from Africa.
Breaking Down the Key Challenges
Red Sea Insecurity
Attacks in the Gulf of Aden have forced shipping lines to reroute vessels. Ships that once used the Suez Canal to enter the Mediterranean Sea via Egypt are now forced to travel around the Cape of Good Hope in the Southern Tip of Africa. This significantly increases both transit times and costs.
Port Congestion
Djibouti, the primary port for Ethiopian coffee exports is struggling with congestion, limiting container availability and vessels temporarily stopping service due to safety concerns for crew and cargo.
Equipment Shortage
A critical shortage of empty containers in Ethiopia is further hindering exports. While the Mediterranean Shipping Co. (MSC) has managed to accumulate a reasonable supply, shippers need to rebook with MSC to access that equipment.
Carrier Capacity and Reliability
Carriers are facing capacity constraints, equipment shortages, and operational disruptions. The aforementioned restrictions have led to unreliable service and the potential for increased rates.
Increased Costs
Longer transit times, port delays, and raised fuel costs have created “Emergency surcharges” of up to $1,500 per container. These fees are becoming more common.
Looming Labor Disputes
The threat of a strike by the International Longshoremen’s Association could further disrupt the supply chain and impact costs. As of now, there is nothing concrete to report, so we will continue to monitor the situation.
Final Thoughts on Coffee Shipping Challenges
These challenges inevitably impact the price of coffee, compounding the already high prices fueled by the rise in the “C” market. This creates uncertainty for domestic supply of Ethiopian coffee, as well as other East African coffees as we approach their harvest and export seasons (Rwanda, Tanzania, and Burundi, just to name a few). If these coffees are essential for your offerings list, let’s discuss what can be done. As we currently have a clearer idea of what we’ll have in stock and when, we can help you plan your forward inventory needs to ensure supply. For now, we hope people across the globe are safe and can find peace in this turbulent world.