How have DMCC’s coffee and tea centres enabled the trade of 100+ coffee varieties from major growing regions in Africa specifically, knowing Ethiopia is a number one exporter followed by Uganda and Kenya?
Looking at coffee specifically, supply chains are complex and are particularly sensitive to pricing. We addressed this global challenge by setting up the Coffee Centre and making use of Dubai’s strategic geographical location.
Through this, Dubai has become a global hub for the coffee trade, helping connect co-ops and farmers across the world with new markets. We offer a range of cost-effective storage, roasting, packaging and trading solutions, and given our connections in a range of global markets, doing business through DMCC provides farmers or traders with an increased level of legitimacy.
We are proud to work very closely with farmers across Africa in tea and coffee. In fact, we have facilitated the trade of coffee from eight producing countries, including Ethiopia, Uganda and Kenya.
Demand for the diverse range of African coffees is on the rise, so we expect to see volumes increase alongside a broader set of varieties in the coming years.
Has DMCC expanded African businesses or brought in quantifiable profits through its trade facilitation? If so, how?
In total, DMCC today is home to over 24,000 businesses operating across every sector and industry. This sizeable member base exists because of DMCC’s ability to act as a catalyst for growth. This also holds true to the 2,000-plus African businesses that call DMCC home.
The opportunities on offer within DMCC and Dubai facilitate rapid international expansion for any business, and this is backed up by a number of positive macroeconomic trends across the board.
For tea and coffee, we are seeing a larger proportion of global trade happening in Dubai, meaning there are ample opportunities for African businesses to scale further.
There are two main drivers behind this. Firstly, you can transact in a single day in Dubai given the robust financial and trade infrastructure, reducing costs and increasing efficiencies given the quicker turnaround time. Secondly, our currency is pegged to the dollar, meaning there is always a constant for any trader to know the value of the beans or leaves at any time, as well as the increased level of financial stability that comes with this.
How does the DMCC, particularly with the Coffee Centre, facilitate and promote the trade of African agri-commodities like coffee, tea, and others through its agri-commodities ecosystem?
One of the most impactful areas where we have been able to support the trade of African agri-commodities is with DMCC Tradeflow. This is an interactive platform which streamlines access to trade finance. Tradeflow has played a pivotal role in unlocking trade financing and working capital opportunities for our members trading African coffee, which in turn has helped to significantly grow trade volumes through the Centre.
We also have a range of trade-enabling partnerships with DP World’s entities such as World Logistics Passport (WLP) and Dubuy.com, which have opened market gateways for African producers through preferential logistics services and digital global market access.
The DMCC Coffee Centre is continuously looking for strategic partnerships with key coffee associations in Africa to enhance trade and logistics efficiency. An example of an existing collaboration would be extending a range of competitive business set-up packages to members and affiliates of the African Fine Coffee Association.
And finally, we actively promote member-to-member trade across our entire business district. For our Coffee Centre members, this enables sellers to reach a global network of commodities traders, retailers and consumers. We are also in the process of fully digitising this type of trade and enabling buyers to finance their purchases.
What kind of market access and knowledge do you offer African producers to help them succeed in the global FMCG market?
The work that we do to promote member-to-member trade, combined with our strong global network with trade associations and other important organisations, means that the market access African producers get through DMCC is unparalleled.
We have plenty of success stories on how DMCC helped local African coffee brands leave Africa for the first time to tap into some of the fastest growing markets globally. To our knowledge, there are no other places in the world where this can be done to the scale that we are able to.
Any figures you can share on number of African coffee and tea manufacturers that operate out of the coffee and tea centre, and the volume of tea and coffee products that get re-exported from the centres?
We have many hundreds of members from all over the world, some re-exporting green coffee and some trading within the GCC markets. African businesses make up a good portion of our tea and coffee members, so there is a significant community of African agri-commodities businesses in Dubai.
The DMCC Coffee Centre processed 7,330 metric tonnes of coffee in 2023, and served as a major trade facilitator for producers in Africa as well as in Central and South America and Asia. We expect this to grow steadily in the coming years given that the UAE’s coffee market will grow by 8.4% annually through to 2029.
The DMCC Tea Centre handled 32,000 metric tonnes of tea in 2023, supporting the UAE’s status as one of the largest re-exporters of tea in the world. The UAE tea market is projected to grow by 13.18% from 2024 to 2029.
Any info on African case study companies that have set up at DMCC Coffee or Tea Centres and leveraged these platforms as hubs to grow and boost exports/re-exports?
A great example is the Kenya Tea Development Agency (KTDA). KTDA is made up of, and owned by, more than 600,000 small holder farmers and accounts for over 60% of the tea produced in Kenya.
They established their DMCC office in 2008 to promote sales of Kenyan teas in the UAE, the wider Middle East, and the CIS states. Through tea storage, warehousing and packaging services provided at the DMCC Tea Centre, they were able to use DMCC as a conduit to reach a whole new customer base.
Since its inception, KTDA DMCC has seen a 2000% increase in business through the UAE, with its market share also growing substantially for bulk tea re-exports through the region.