USDA Report: Ethiopian Coffee Production Up as Government Pushes Modernization

Production and Exports Both Forecast Higher

The USDA's annual report on Ethiopia's coffee sector forecasts green coffee production rising 4.7 percent to 12.1 million 60-kilogram bags in 2026/27, with exports projected at 7.13 million bags, up 2.4 percent from the previous year. Harvested area is expected to expand 1.3 percent to 800,000 hectares, worked by some 5.9 million farmers — smallholders still account for roughly 90 percent of national output.

Domestic consumption is also forecast to climb 11.1 percent to 5 million bags, a reminder that Ethiopia is one of the few origins with a deep internal coffee culture competing for its own crop.

100,000 Hectares for Commercial Coffee Farming

The report's most striking finding is the government's modernization push. Ethiopia has allocated 100,000 hectares for private-sector coffee development — a roughly 70 percent expansion of the country's commercial farm base — and 110 private investors have already received farmland in the Oromia and Southwest Ethiopia regions. The new farms are expected to adopt mechanized land preparation, structured planting, improved varieties, smart irrigation, and intensive inputs to lift yields and consistency.

Officials describe the initiative as a strategic shift toward a hybrid model that pairs Ethiopia's traditional smallholder base with large-scale, technology-driven production, citing Brazil's commercial plantation systems as a reference point.

Rejuvenating an Aging Tree Stock

About 70 percent of Ethiopia's coffee trees are old, some more than a century. Stumping — cutting trees back to regenerate growth — covered 15 percent of harvested area in 2025/26, and studies cited in the report show stumped trees can increase yields up to threefold within four years. More than 50 improved varieties with higher yields and disease resistance have been distributed to farmers.

What Buyers Should Watch

The 2024/25 export year closed at $2.89 billion on a 31.9 percent volume increase, with exports to China surging 264 percent. At the same time, record-high local cherry prices and softer international prices have squeezed exporter margins — context worth understanding when negotiating contracts with an Ethiopian coffee exporter. For sourcing teams, the report signals growing, more consistent supply of Ethiopian green coffee beans in the seasons ahead.