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Ucda faciltates coffee quality, value addition and domestic consumption workshop

Uganda

On 28th February 2016, UCDA was invited to facilitate in the workshop organized by Reh Agro Ltd at Speke Resort, Lweza. Reh Agro Ltd. is an organization which desires to empower people to be wealth creators through engagement in various economic activities.

The workshop was intended for the participants to appreciate the coffee value chain (CVC) and know with certainty the various actors in the CVC. It was also for creation of awareness to the Financial Intermediaries about what happens in the Coffee Value Chain which would in turn enhance their assessment and proper identification of where funding can be profitably targeted.

The workshop was opened by Hon. Mathias Kasamba, MP Kakuuto County, Rakai District who also doubles as Chairman Parliamentary Sectoral Committee on Agriculture and also Parliamentary Coffee Platform and closed by the Hon. Minister of State for Agriculture and MP Kalungu East, Hon. Vincent Sempijja.

Opening Remarks by Hon. Mathias Kasamba, MP Kakuuto County

In his remarks, Hon. Mathias Kasamba first thanked the organizers Reh Agro Limited and specifically Ms. Hawa Nabulime for her zeal and determination for young people to be job creators. He was also thankful to those who had turned up to share knowledge on the coffee value chain. He requested Tropical Bank and Reh Agro Ltd to visit his farmers whom he had mobilized in Rakai district to appreciate how farmers were performing. He emphasized the need to have success stories from different farmer groups who would demonstrate that coffee farming is big business and that farmers can be mobilized into viable economic units.  He pointed out that he had 30 acres of coffee and was planning to plant 20 more in the near future. He was also planning to establish a training centre where experiences would be shared to enhance learning in order to increase productivity, foreign exchange. He shared how some farmer cooperatives such as Bukonzo Joint Cooperative Society had integrated upwards along the coffee value chain and had established a grading plant and in the process of even establishing a roasting facility. He submitted that farmers should aim at adding value to their coffee. He decried that farmers had not yet enjoyed the returns from coffee. He assured the audience that partnering with UCDA and other organizations, they would continue empowering the farmers especially the young ones to embrace coffee and also add value to the crop. He decried the low coffee volumes since independence comparing it with Vietnam which had started with only a half a million bags and is now producing 30 million bags. He emphasized that ‘we need champions in producer organizations’.

He gave an example of the Parliamentary Coffee Platform comprising of over 200 Members of Parliament who are champions at the legislative level. He challenged the audience ‘we have a lot of work. Let’s empower farmers to participate in processing just like the Vietnamese did’. He advised that the youth, instead of being used by middlemen to destroy the quality of coffee produced, they would settle at farming and reap the benefits that accrue from farming. He also noted that whereas pre-financing is good, it should not compromise quality. He urged farmers to do selective picking. He said he was envisaging a situation where coffee is produced when it is of high quality, processed and packaged in such a way that it is marketed at a competitive price. He indicated that he had started a campaign of increasing domestic coffee consumption in Parliament. He advised all the participants to apply Good Agricultural and post-harvesting Practices to enhance the quality of Uganda’s coffee. These, he submitted, could be:  acquisition of hand-pulper; raised drying trays; baskets (those who practice wet processing).  He hinted on the intrinsic quality of Uganda’s coffee which makes it very competitive on the global market. In his concluding remarks, he assured participants that he expected a behavioral change after viewing a documentary from Vietnam which would challenge everyone to do something.

Reactions from the Chairman’s Remarks & Lessons Learnt from the Vietnam’s Documentary 

After a 20 minutes documentary on Vietnam’s visit, participants were asked what they had learnt from the same and also react to the opening remarks. The following were the main action points:

  1. The Vietnam’s experience is very interesting and relevant for Uganda
  2. The Vietnam’s production system was monocrop although the coffee acreage is similar to Uganda.
  3. Need to go back to the pre-liberalization era where coffee especially from Bugisu region was handled properly
  4. Value addition at farm level using appropriate machinery is critical
  5. The need for farmer to farmer visits
  6. Appropriate transport using donkeys (same as in Sebei region)
  7. Farmers’ access to financing-this was seen as very critical.
  8. Role of government, financial institutions in empowering small scale farmers. Vietnam’s government had initiated a small tractor project in which tractors would be purchased by small farmers
  9. Paper on assessment of coffee sector since liberalization had been written by Hon. Kassamba and would be availed to those interested on request.
  10. Water for production-Utilization/efficient use & appropriate irrigation technology
  11. Efficient application of fertilizers to enhance yields
  12. The need to ensure economies of scale is critical
  13. Domestic coffee consumption was also hinted as one of the ways of enhancing quality. The KYC (Know Your Coffee) sessions should be enhanced for farmers to appreciate the quality of the coffee they produce.

Presentation on the Coffee Value Chain-James Kizito-Mayanja, Market Intelligence & Information Manager, UCDA

After elaborating on the global and national perspectives of the coffee sector which reflected the current global coffee production and consumption, Mr. Kizito-Mayanja hinted on the major actors in the coffee value chain and the key service providers who add value to the coffee. He outlined the different marketing channels and how they could be shortened if farmers were mobilized into viable economic groups. He dwelt on the market dynamics and factors which drive the local coffee market-quantity, quality, and knowledge on current pricing and where to sell. He underscored the importance of market information and also informed participants about the different channels market information could be accessed: SMS, telephones, website & radios.  He outlined value adding activities which bring more money in the hands of farmers and also hinted on those activities which lead to what he termed as ‘value subtraction’ which make Uganda coffee less competitive. Mr. Kizito-Mayanja also hinted on domestic consumption bringing out heath benefits of drinking coffee. He urged participants to drink more coffee because of the health benefits associated with it.

Coffee Quality Aspects at Farm Level-Edward Lutaakome-Sentamu, Regional Manager, Central, UCDA

Mr. Lutaakome-Sentamu elaborated on the quality aspects at farm level which, if not addressed by farmers, could lead to quality deterioration. The good quality starts from getting the right planting material, proper establishment of the coffee shamba, proper crop management including timely weeding and pruning as well as good harvesting practices (selective picking).  This must be followed by good drying practices as well as proper storage.

He recognized and appreciated that Financial Institutions (Intermediaries) support Coffee Trading activities but also urged them to also fund efforts that can empower farmers in Organization, Advocacy and Governance.

Due to time constraint, he could not expound on some aspects. In addition, some aspects had been tackled in the earlier presentations and discussions. He, however, assured participants that all documentation related to nursery management, quality enhancement, Good Agricultural Practices and Coffee Value Chain presentation would be sent to them on email.

Presentations by Tropical Bank and FINCA (Mr. Opio and Ms. Charity Busingye)

The presenters appreciated the workshop and sharing the dynamics in the coffee value chain. They promised to work hand in hand with Reh Agro Ltd and other participants to make farmers’ access to financing easier by providing suitable financial products. The banking institutions were requested to disseminate information on how to access funds from the banks. Mr. Opio (Tropical Bank) decried the factors which hinder access such as: poor record keeping, poor organizations leading to failure to have bankable projects. Tropical Bank also disseminated information on availability of the Agricultural Credit Facility which offers loans at very low interest rates. Mr. Opio concluded by indicating the need to profile coffee farmers in order to serve commercial farmers who have a higher likelihood of accessing funds and paying back. It was also argued that banks need to understand the uniqueness of agricultural value chains and develop financial products which suit the production and marketing cycles therein.

Closing Remarks by the Hon. Minister of State for Agriculture, Hon. Vincent Sempijja

The Minister thanked the organizers and facilitators for the workshop. He informed participants that UCDA, NARO, CDO, DDA and Oil Seed Association are sector agencies under the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF). He therefore reported that this particular workshop which handles coffee was therefore very relevant to MAAIF. He emphasized that the Ministry’s thrust currently is on strengthening farmer organizations. He pointed out that buyers are keen on knowing how and where coffee is produced and hence the World Bank funded cluster programme which hinges on a particular key sector: coffee, tea, beans, maize and cassava. In this project, registration of farmers will be done. The other emphasis is on tractorization. A voucher system has been initiated in which agricultural inputs would be given to farmers on credit. Government will enhance its extension services, popularize irrigation technology (small, medium and large) and address pests and disease management. He also submitted that multiplication of the Coffee Wilt Disease (CWD) resistant lines was ongoing in a number of coffee nurseries. He also hinted on use of spray gangs in the heavily infested areas. He mentioned the coffee bill which is at cabinet level which will be presented to Parliament soon. He indicated that he would like to see coffee map reflecting where the farmers are, model farmers with high yield per tree, organized coffee farmer groups.

In his concluding remarks, the Minister emphasized the need to engage the financial institutions fully to avail financing. He also reported that Government had increased NAADS funding from Sh. 203 billion to Sh. 1,000 billion. Government had also secured funding worth US$ 300 million from the Arab Bank to fund coffee and tea programmes.

Way Forward

  1. Using the Task Force Approach, engage OWC to register farmers  at parish level
  2. Organize farmers into viable economic units
  3. Develop water management system
  4. Popularize the e-voucher system to access agro-inputs on credit
  5. Build strong partnership among CVC stakeholders
  6. Enhance information dissemination on the road map to revamp the coffee sub-sector
  7. There is need to have a coherent programme for young people
  8. Create awareness on financing products available to farmers
  9. Build capacity of Farmer Organizations to write bankable projects that could be taken to banks for funding.

Concluding Remarks

Ms. Hawa Nabulime of Reh Agro Ltd. was thankful to everyone who had participated in the awareness creation workshop on the coffee value chain. She pledged to continue engaging stakeholders to create jobs especially for the youth. The closing prayer was led by Hajjati Rehema Nandudu.