New Bill Targets Chaos in the Spice Trade

Jan 31 , 2026. By YITBAREK GETACHEW ( FORTUNE STAFF WRITER )

The spice sector, long overshadowed by the dominance of coffee, is at the threshold of sweeping change. For the first time, federal authorities are advancing a bill to regulate every step of the value chain, introducing certification, inspections, and strict penalties. If enacted, the law will require all actors, from farmers to exporters, to secure competency credentials within one year.

The spice sector, long defined by informality and a lack of regulatory oversight, enters into a turning point. After years of fragmented production, inconsistent quality, and weak market infrastructure, the federal government is preparing a bill that could reshape the market, if it survives the bureaucratic gauntlet.

For the first time, the sector is facing the prospect of systematic regulation. From farm to export dock, every step in the value chain may soon be policed by new rules, strict penalties, and a host of state certifications.

Spices are an overlooked asset in the agricultural portfolio, overshadowed by coffee, which accounts for roughly a third of export earnings. Experts in the field argue that the absence of formal oversight has produced a volatile market. They blame adulteration, arbitrary pricing, and value-sapping middlemen, all endemic, which harm quality and reputation.

The sector’s neglected infrastructure remains a policy flashpoint. According to Amana Geydsab, who leads the Sheko Amora Gedel Multi-Purpose Limited Union, overseeing 30 unions and 10,000 members, the lack of a legal structure has led to poor accountability, widespread quality lapses, and capital tied up in unsold inventory.

“We're exporters, but there are many hurdles to clear before we can ship,” he said.

Amana drew a sharp distinction between coffee, which is underpinned by strict regulation and institutional support, and spices, which have been left to informal actors. He warned that without legislative teeth, the sector will continue to lag.

The bill's authors see the framework as essential to reversing this decline, creating a sector that can compete on the international stage, generate higher rural incomes, and move the economy beyond its dependence on coffee.

This regulatory push is driven in part by frustrations within the sector.

“The lack of a framework has allowed the market to be dominated by those who add no value,” said Usman Surur, head of the agriculture bureau under the Central Ethiopian Regional State.

Usman, who led the Federal Cooperative Agency for a decade, argued that new legislation is necessary to preserve the agroecology of spices and ensure rigorous quality inspection during post-harvest handling. He sees the bill as a mechanism to wrest control from intermediaries and empower producers.

In his region, over 16,000hct are dedicated to rosemary, with annual ginger output exceeding 2.5 million quintals, yet this high volume has not translated into high value. Usman argued that farmers’ weak bargaining power, driven by the absence of centralised trading and inadequate training, led to price distortions.

“Currently, the middleman acts as the price-maker," he told Fortune. "This ought to be addressed.”

Usman called for greater training for farmers in post-harvest handling and quality preservation.

The draft proclamation, still under review by experts at the Ethiopian Coffee & Tea Authority (ECTA), proposes mandatory competency certification for everyone handling, processing, or trading spices. Within one year of enactment, it will become illegal to operate in the sector without such credentials. Federal and regional authorities will be empowered to issue, suspend, or revoke certifications and to set detailed standards by directive.

All actors, from farmers to exporters, would be legally required to cooperate with inspections and regulators, with noncompliance subject to fines. The bill also prescribes jail sentences of up to five years for those whose actions endanger public health or compromise product integrity.

A central tenet of the draft law is its effort to impose order on the market.

Primary sales should take place in first-level centres approved by regional authorities. Secondary trades, including through the Ethiopian Commodity Exchange (ECX), would take place at designated hubs. Licensed marketplaces will need to be equipped with weighing systems, daily price boards, and quality monitoring. Farmers are restricted to selling only at these centres and have to adhere to approved post-harvest practices, a notable shift from the current practice of selling to whoever offers cash.

Retailers will need both a trade license and a competency certificate, and they will be permitted to buy only from certified suppliers.

The new rules will also bind processors and wholesalers. They will have to work only in officially permitted areas, maintain detailed records, and comply with technical standards. Any remaining inventory after export or value-added processing should reenter the market through official channels, thereby closing loopholes that have enabled off-the-books trading.

The bill further mandates specialised logistics. Spices are to be transported in dedicated vehicles, a measure modelled on existing coffee regulations. Transporters and drivers face stiff penalties for illegal shipments, unauthorised routes, or unhygienic handling, including jail time and fines, depending on the severity of the violation.

The designated authority will oversee market supervision, assign inspectors, and enforce compliance. All actors in the spice value chain will be legally required to cooperate with inspections and regulatory measures directed towards protecting quality, food safety, and fair trade practices.

Export procedures will be strictly regulated, with exporters required to use formal contracts with foreign buyers and to register these agreements with the National Bank of Ethiopia (NBE) within 72 hours. They will be required to notify federal authorities, as the foreign market engagement is limited to 90 days. Exporters also need to comply with mandatory quality inspections, grading, and certification requirements.

However, exporters like Yenenesh Alebachew, founder of Majet Agro Processing Plc, recounted persistent struggles to source raw material that meets export standards. In 2025, her company exported 60tns of spices, earning 145,000 dollars, but unreliable supply chains and inconsistent quality threaten future growth. Her company is often forced to source from central markets and individual collectors, a fragmented process she believes would be streamlined by a centralised trading hub.

“A central marketplace would stabilise the supply chain and address the arbitrary price hikes we currently face,” she told Fortune.

Running her business from a government-provided shed in the Wossen area for a monthly rent of 5,000 Br, Yenensh contended that the absence of a robust legal framework specifically addressing quality control in production farming areas and the supply chain is the primary bottleneck for processors.

While Majet Agro Processing primarily serves customers in the United States and Canada, Yenensh admitted that breaking into broader international markets is difficult.

“It's difficult to secure new customers when we can't remain competitive with other spice-exporting countries,” said Yenensh, who has been operating in the volatile spice sector since 2018.

However, she remained worried about inconsistent quality. A recurring issue is the moisture content of spices. Products that are not sufficiently dried lose weight during the final processing stages, eating into profit margins.

“Our products must meet rigorous international standards," she said. "But that begins with the quality of spices we receive.”

Yenenesh’s experience echoed a policy dilemma that a regulatory overhaul may increase compliance costs and require new investments in training and infrastructure, but without it, Ethiopia’s spices risk permanent marginalisation in global markets.

Spice exports are currently limited to diaspora communities and a handful of neighbouring countries. Experts urge that breaking into larger and more lucrative markets will require not only higher quality but consistent enforcement and visible branding, outcomes that the current system cannot deliver.

"Drafting a law is only the first step," said Sani Tuke, a consultant and founder of Optimum Logistics. "It must encompass every nuance of the spice trade, mirroring the rigorous oversight applied to coffee.”

For international trade experts like Sani, the absence of a regulatory regime is the primary obstacle to growth. He sees weak demand assessment and scant brand awareness as critical gaps.

“A surge in production is meaningless without a corresponding market,” he said.

Sani advocated demand-driven production, mechanised farming, and an aggressive international marketing push, none of which, he contended, is possible without the order and traceability that regulation would impose.

However, the bill in the making is not without its ambiguities and potential pitfalls. The process for certifying actors throughout the value chain, for instance, is not clearly detailed in the draft. The financial implications for smallholders, many of whom operate at low margins, are also unclear, raising questions about the state’s capacity to roll out training and absorb compliance costs without pushing out the most vulnerable producers.

The 16 spices covered by the law, out of more than 100 produced in Ethiopia, raise additional questions about inclusivity and priorities.

Another area requiring clarification is the timeline. The draft has reportedly languished for nearly a year at the Authority and has yet to be finalised for submission to the Ministry of Agriculture and the Council of Ministers. Meanwhile, the industry operates under a patchwork of ad hoc enforcement measures, with quality and safety often left to consumer protection agencies or regional authorities with limited reach.

Proponents of the law hope that centralisation will weed out intermediaries, stabilise prices, and drive up quality. Yet, critics cautioned that overregulation or poorly designed compliance systems could choke off smallholder participation or increase costs beyond the sector’s ability to pay. The bill’s success, they argue, will depend not simply on passage of a law but on how effectively it is implemented on the ground.

“The government can’t achieve the expected results due to a lack of a legal framework,” said Belete Tesfaye, a law department officer at the Authority and one of the bill's drafters.

PUBLISHED ON Jan 31,2026 [ VOL 26 , NO 1344]