Agriculture, which constituted 46 percent of GDP and more than 80 percent of exports, is by far the most important economic activity in the Ethiopian economy. An estimated 85 percent of the population are engaged in agricultural production. The most important agricultural exports include coffee, hides and skins (leather products), Pulses, oil seeds, beeswax, and, increasingly, tea. Domestically, meat and dairy production play an integral role for subsistence purposes.
According to Infomineo (2016), the key agricultural sectors in Ethiopia are the following:
Coffee & tea; Ethiopia has a great potential for coffee production, thanks to the country’s abundant rainfall, optimum temperatures, conducive altitude, and fertile soil. Over 60% of Ethiopian coffee is produced as forest coffee, and therefore the use of fertilizers is usually unnecessary as the falling leaves enrich the forest floor. Also, the use of chemicals such as pesticides, fungicides among others is limited since the high genetic diversity in the forest creates a balance between parasites and pests (Ethiopian Coffee Exporters Association, 2016).
Ethiopia is Africa’s largest coffee producer, and the fifth world’s producer contributing some of the world’s finest coffees. The country accounts for over 3% of the global coffee market. Coffee is by far the country’s largest foreign exchange earner. Some of the major destinations of Ethiopian coffee are Germany, Saudi Arabia, Japan, the USA, Belgium, and France, importing over 70% of the country’s total coffee exports (Tefera, Abu, 2015).
While Ethiopia has the potential to grow all types of tea, the country produces only black tea, with a production capacity of 7,000 tons of black tea per annum. According to the country’s ministry of industry, the tea industry has been lacking investment (Ethiopia’s Ministry of Industry, 2016). Thus, investment potential exists in large-scale commercial tea production as well as modern tea packing and blending industries.
Cereals; Maize is one of the most important crops in Ethiopia of which the country is Africa’s second-biggest maize producer. Other important cereals are wheat and barley. There are also opportunities for wheat production under irrigation in some regions.
Livestock & Fishery sector; Ethiopia’s livestock population is believed to be the largest in Africa, and tenth in the world. The sector accounts for about 10% of Ethiopia’s export income, with leather and leather products making up 7.5% and live animals 3.1%. The country is home to about 49 million heads of cattle, 22 million heads of goats, 17 million heads of sheep, and 38 million chickens. The country also has demonstrated potential for fishery development in its freshwater lakes, reservoirs, and rivers. Other investment potential areas in this sector include fish, milk & meat processing, raising and fattening of sheep, goat, cattle and camel (Ethiopia’s Ministry of Industry, 2016).
What are the main characteristic of Ethiopian agriculture activities? The Ethiopian agricultural activities are:
a. Practiced at a subsistence level
b. Used fragmented agricultural lands
c. The soil used by the sector is degraded
d. Dependence on rain-fed agriculture
e. Traditional cropping systems
Lack of capital
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