No livestock trade in the region is as concentrated, as seasonal, or as formally documented as the small-ruminant export corridor running from the Horn of Africa’s interior to the Arabian Peninsula through the port of Berbera. In 2024, Somaliland exported 3,802,903 head of livestock through Berbera — 3,455,842 of them sheep and goats — making this the closest thing East Africa has to an industrial-scale, purpose-built live-export economy.

01A one-buyer, one-season trade

Saudi Arabia is overwhelmingly the destination for small-ruminant exports from the Horn of Africa, and the trade is sharply seasonal: roughly 70% of small-ruminant export volume moves during the Muslim Hajj season, when demand for sacrificial sheep and goats for Eid al-Adha spikes sharply. Yemen and Oman are secondary destinations, but these skew toward cattle rather than shoats. Up to one million sheep and goats have been recorded crowding Berbera’s quarantine pens during peak season alone, arriving from markets across the Horn to be shipped across the Gulf of Aden in the weeks before the pilgrimage.

This concentration makes livestock the dominant force in Somaliland’s export economy — livestock has accounted for between 67% and 90% of total export earnings in recent years, rebounding to roughly 75% in 2024 after a multi-year dip. Up to 80% of Somaliland’s total export income is generated by sales of sheep, goat, camel and cattle combined, with sheep and goats the largest single component by volume.

02Ethiopia supplies the animals, Somaliland captures the value

The physical origin of most of these animals is not Somaliland itself. Estimates of the share of Berbera and Bosaso’s combined export volume originating in Ethiopia’s Somali Region range from 50% to 80% depending on the source, with roughly 65% cited as a working average across multiple studies. Yet the value captured at the point of formal export accrues almost entirely to Somaliland: export fees collected at Berbera run to US$3.50 per head of sheep or goat, US$18 per head of cattle, and US$35 per camel — revenue that Ethiopia’s own fiscal system never sees, since only small municipal market fees (as little as 1 Ethiopian Birr per shoat at Jijiga) are collected on the Ethiopian side, and none of that revenue is shared with the regional or national government.

03A trade defined by boom-and-bust shocks

Few livestock trades anywhere are as exposed to single-event shocks as this one. Saudi Arabia has twice imposed blanket livestock import bans on Horn of Africa exporters — most disruptively around 2000, citing Rift Valley Fever concerns — and in that episode Berbera’s exports collapsed from roughly 2 million head before the ban to just 50,000 head, a 97.5% collapse that devastated pastoralist incomes across the supply catchment for close to a decade before formal export volumes recovered. The COVID-19 pandemic delivered a more recent and more sudden version of the same shock: with Hajj effectively cancelled in 2020, Somalia’s livestock sector was projected to lose approximately US$500 million in a single season, with tens of thousands of livelihoods put at risk almost overnight.

Because roughly 70% of annual export value depends on a single religious calendar event each year, this is a sector where the concept of “seasonality” understates the actual risk profile — it is closer to a single annual settlement date on which the bulk of the year’s trading income depends, with essentially no way to shift that date or spread the exposure across the calendar.

“Somaliland commands up to 85% market share in the supply of goats… In this year’s Hajj season, the port will remain dormant and will not ship neither a goat nor sheep.”

04What this means for sourcing and finance

The Goat & Sheep trade is structurally different from every other issue in this series: it is the one segment where formal, port-based export infrastructure is genuinely mature — quarantine stations, an established fee schedule, decades of trading relationships with Gulf buyers — yet the value distribution across the supply chain remains almost as lopsided as the informal cross-border trades covered in the Beef & Cattle issue. The binding constraint on Ethiopian pastoralist income is not market access to the Gulf in the abstract; it is the absence of Ethiopia’s own internationally recognised quarantine and certification infrastructure, which is what currently forces its livestock through a Somaliland-controlled bottleneck at a steep discount.

For a trading and finance desk, that gap is also the opportunity: investment in quarantine and certification capacity on the Ethiopian side of the corridor — or direct commercial relationships with Ethiopian Somali Region traders positioned to sell closer to the border rather than through Berbera intermediaries — could capture margin currently lost to the arbitrage described above. Any financing structure in this space needs to explicitly model Hajj-date concentration risk and historical ban-driven volume collapses (a 97.5% single-event drawdown is not a tail scenario here, it is a documented precedent) rather than assuming smooth, calendar-linear revenue.