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57 rice companies fold operations

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Redudant rice milling machines at Damaza Grain Millers Limited factory in Jinja District. The company is among those that laid off some workers due to low production capacity. PHOTO by Joanita Mbabazi 

Recently, rice farmers, millers and exporters petitioned the Speaker of Parliament Rebecca Kadaga to stop the eviction of rice farmers from wetlands in favour of foreign investors.
Mr Isaac Kashaija, the chairperson of the Rice Business Sector Association, said the rice farmers were stopped from growing rice in wetlands, a situation that has left many jobless.
“If we are growing rice in wetlands and government thinks we are not doing it the right way, then we need to be guided on the best modern farming practices of growing rice in because rice as a food crop best grows in wetland areas. We are surprised that the wetlands are being given to investors to grow rice, leaving us the local farmers with no space to grow rice and the only option is to quit rice growing,” said Mr Maliba Christopher a farmer in Bugweri district.
To prove their outcry, Daily Monitor visited some of the rice milling factories and the rice gardens. At Damaza Grain Millers Limited factory, redundant machines greet us. Here, few workers also load skeletal sacks of rice for few locals who had come to buy the commodity. This was the same case at Wereke Investment Limited factory.
Much as we expected to hear sounds of machines sorting rice, or some activity involving loading and offloading sacks of both of sorted and paddy rice (rice with husks), this was not the case.
According to the owner of Damaza Grain Millers Limited, Mr Drake Magara, they laid off some workers due to low production capacity.
“On a daily basis, we used to mill around 50 tonnes of rice in a day. But now, we only mill five tonnes of rice.”
Mr Magara attributes this to farmers who ditched rice farming for other food commercial crops that can be grown on land as some have already faced eviction from wetlands to grow rice.
“Farmers have been evicted from the rice fields. They no longer get enough paddy rice to mill forcing them to lay off some workers. I have been employing 50 employees both those operating the machines to sort out rice and others in packaging loading and offloading. But I was forced to remain with 25 employees only,” Mr Magara says.
He adds that instead, imported rice has flooded the country.
“Why would we rely on foreign food like rice yet it can be locally grown here?” Magara adds.

A rice farmer in a wetland in Jinja. Farmers

A rice farmer in a wetland in Jinja. Farmers have been evicted from their rice fields. PHOTO BY Joanita Mbabazi

Low price
The price of local rice has gone down because local millers and retailers have to earn something to compete with the imported rice from other countries.
“This discourages farmers because a kilo of paddy rice costs Shs500, from a farmer. At retail price, a kilo of local fine rice costs Shs2,500 while a kilo of imported white fine rice is Shs3,000. We cannot sell at Shs3,000 because we shall not make more sales since we are competing with the imported rice as well on the market,” Mr Geoffrey Sudayisi, a retail business man in Jinja District says.
The rice sector employs more than 49,000 both millers, importers and farmers. But with the continuous low production, these are likely to abandon the business. Already, 57 companies that have been operating in losses of about Shs38b have closed business due to low production and meeting costs such as electricity and paying off workers. Bu and taxes cannot be affordable as they are earning less from the business.
Demand
According to Mr Isaac Kashaija, chairperson Rice Business Sector Association Limited, between 2007 and 2014, the demand of rice was about 225,000 metric tonnes but factories only produced 165,000 metric tonnes. From 2014 to 2017, the demand for rice increased to 499,200 but they were only able to produce 272,881 metric tonnes of rice.
In 2017 to 2019, the demand did not increase and remained the same like in 2017 but they were only able to produce 215,741 metric tonnes of rice. This implies that despite increased demand for rice, they cannot meet the production capacity to satisfy the all local consumers who need rice due to the increased decline in the production levels.
Mr Kashaija also complains that the increased importation of white fine rice from other countries like Tanzania which is not subjected to tax is greatly crippling the local rice business for people to earn from it.
14 rice import companies which include SWT Tanners Limited, General Agencies Uganda Limited,Ssuna Limited , Willex Commodities Limited, Akhcom Limited, Jassani General Trading Limited, Singa Rice Limited, Armour Trading Company Limited, Jan Mohammed Investments Limited,Galorre Intrenational Limited, Imba Foods Uganda Limited, Zen Trading Limited and Mabu Commodities, have been relieved of paying tax due to a delayed court appeal filed by these companies against Uganda Revenue Authority at the Commercial Court since 2014 opposing the 18 per cent VAT.

Import duty
These argue that they are currently paying 75 per cent import duty on rice, six per cent Withholding Tax, and 1.5 per cent infrastructure levy. Therefore, the addition of 18 per cent VAT levy would make their products expensive and unaffordable for customers.
“These are greatly enjoying the market space in the country as no ruling has been made yet since 2014 to date. During that financial year of 2014/2015, the VAT tax law was meant to work but these companies objected it saying this was abrupt and they were not notified as they had targeted to import rice for the festive season that year.
“But since 2014, up to now we find this unfair because when some exporters go to Tanzania much as it is part of the East African Community (EAC), they are charged taxes. But these importers must also pay the 18 per cent VAT tax,” Mr Kashaija says.
According to Mr Everest Kayondo, Kampala City Trader’s Association chairperson, importers within the EAC cannot pay tax on imports and exports due to the free movement of goods of services in all partner states. However, those who are not under this body find it fair enough to pay tax for their imported rice especially from Pakistan and India.

Power
Companies which have closed business include:
•Kikagate Traders Ltd, Taubah General Enterprises, Band Investment Uganda Limited,
•Upland Rice Millers Company Limited,
•Royal Rice Limited,
•Pearl Rice Ltd,
•Eastern Rice Company Limited,
•OBN Produce and Supply Company Limited,
•Link N Global Commodity Limited,
•3R Agro industries Limited
•Rwenzori Upland Rice Company Limited among others

Source: Daily Monitor

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FARM NEWS

Farmers count losses as dry spell scorches maize gardens

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Many farmers say they had borrowed money from banks and Saccos

During the first planting season, which usually kicks off in March, many farmers had hoped for a bumper harvest.

However, the unrelenting dry spell in some parts of the country has withered the crops, resulting in poor food harvests mainly maize and beans.

Although some districts received rains last week, many farmers, especially those growing maize and groundnuts, are counting losses after several acres of the crops got scorched by sunshine.

In the central region, the most affected are farmers in the districts of Nakasongola, Kiboga, Kayunga, Mubende, Kyankwanzi, Gomba, and parts of Rakai.

In Nakasongola District, the most affected sub-counties include; Nabiswera, Wabinyonyi, Kalungi, and Kalongo where farmers now stare at eminent hunger and lost cash invested in their respective gardens.

In Mulonzi Parish, Nabiswera Sub-county, Mr Simon Male has lost 35 acres of maize.

“I grow maize on a commercial scale, but my entire garden is scorched by the hot sun. I have lost the hope of harvesting any grains from this particular season. I did not anticipate the hot sun. Part of the money invested in my agriculture projects is from the loans,” he says.

Mr Ali Kisekka, a maize farmer and chairperson of Kabulasoke Sub-county in Gomba District, says all his 30-acre maize plantation withered two months after germination (between March and April).

“I spent money on renting the land, labour, purchase of seeds, and other inputs, amounting to Shs6m. Unfortunately, the rain did not come in sufficient amounts,” he says.

“Almost 50 percent of farmers in my sub-county are counting losses. We are now praying for the next season,” he adds.

Irreparable damage

Mr Emma Kintu, another farmer in Kabulasoke, says: “The damage has already been caused and we cannot save anything even if we get rain now, we are going to cut the maize and use it for mulching.”

Mr Samuel Muwata, a produce dealer in Kampala’s Kisenyi suburb, says the poor maize harvest may cause a spike in maize flour prices as was the case last year.

“The demand [for maize ] is increasingly high, and if there is no importation of maize from countries like Tanzania, there will be shortage which will cause prices to increase  possibly  in August or at the beginning of September when schools open for Third Term,” he says.

Currently, a kilo of maize grains costs between Shs800 and Shs1000, down from Shs500 a month ago while maize flour (corn) is between Shs1,800 and Shs2,000, down from Shs1,500.

Mr Augustine Wafula, a farmer in Busabana Village, Lunyo Sub-county, Busia District, says he only harvested four acres of maize from his five-acre garden. “I got a bank loan to plant five acres of maize, but ended up harvesting only four bags,” he says.

Mr Wafula’s loss has dealt a huge blow to his marketing prospects, especially in Kenya, which is a good destination for maize from Sofia and Marachi markets in Busia Municipality.

Because of the relatively good market for cereals in Kenya, several Ugandans were forced to rent land to plant maize. Unfortunately, the weather has left most of them counting losses.

Mr Anatoli Kizza, a farmer in Kiyindi Village, Buikwe District, says he used to supply schools with maize grains, but since the beginning of the year, he had not planted any because of the dry season.

“I tried to purchase the maize grains locally, but they could not reach the kilogrammes desired by the schools,” Mr Kizza says, adding that the dry spell is a result of abuse of the environment, including deforestation and encroachment on wetlands.

In Bugiri District, Mr Imani Mumbya, a groundnuts farmer in Isegero Village, Nabukalu Town Council, says he harvested nothing after planting the crop in his five-acre garden last season [August to December 2023] due to the unpredictable weather pattern, which was characterised by scorching sunshine.

Abrupt weather change

Mr Mumbya says following the first rains in January, he rushed to plant groundnuts. However, the rains abruptly stopped before the seeds barely sprouted.

He adds that because few seedlings sprouted, he cleared the garden in preparation for the second rains in April, which lasted until the end of May and helped the seedlings to sprout.

“But before the groundnuts could spend their entire 86-day period to mature, another drought came which prevented me from harvesting,” Mr Mumbya further explains, describing it as “the worst season during the 10 years he has been a farmer”. Mr Aloysious Kizito, a renowned farmer in Bbugo Village, Kyotera District, says maize harvests in the area have been too low as compared to last season which has reduced farmers’ expected returns on invested funds.

Although this area previously received heavy rains, Mr Kizito believes it was not evenly spread throughout the whole season, which led to poor harvests.

“We received heavy rains for two and half months yet most seasonal crops take three to four months to completely mature,” he says.

The most affected seasonal crops are maize, soya beans, peas, and Gnuts, which is likely to result in food shortages in the coming months.

Mr Abdul Birungi, a cereal farmer in Lubumba Village, Kyotera District, says although he reaped seven tonnes of maize last season from his seven-acre garden, this season he got only one tonne .

He attributes the poor harvests to what he describes as misleading messages issued by experts from the Uganda National Meteorological Authority (UNMA)   which warned farmers against planting crops in January and early February.

“I wanted to plant in early January, but changed my mind upon getting their [UNMA] advice, I feel puzzled because those that didn’t go with their advice in our area at least got good harvests,” he says.

But Ms Lillian Nkwenge, the UNMA principal public relations officer, says many farmers always fail to follow their forecasts as issued and end up blaming the Authority.

“The country is not expected to have major changes in the usual rainfall patterns this year. Most parts of Uganda normally have two rainfall seasons separated by dry season. So  , we hope to get the second wet season in early September,’’ she says.

Weighing options

In Teso Sub-region where farmers have for decades relied on rain-fed farming, they have started having a discourse on how to wholly revert to livestock or continue to depend on crop farming which continues to be affected by the erratic rainfall pattern.

The call to revert to livestock farming comes amid yet another failed crop harvest.

Mr John William Ejiet, the Kapelebyong District production officer, says when farms were at a critical stage of flowering, the drought again set in, leaving hundreds of farmers dejected.

 He says now is the time for farners to invest in micro-scale irrigation.

“Whereas there are small grants for small irrigation from the government for farmers, the rate of adoption is still low yet we are at a critical moment when we need to adapt to new farming techniques other than the rain-fed farming which is no longer reliable,”   Mr Ejiet says

 Ms Joyce Akwii, a resident of Omodoi in Ocokican Sub-county, Soroti District, says she invested more than Shs3m in crop farming but got less than Shs500,000.

 “I have resolved that come next year, my five acres of land that I have been using for crop farming will be turned into a goat and sheep farm,” Ms Akwii explains.

Last resort

Mr Mike Odongo, the chairperson of Ngora District, says for farmers to have a win -win situation, it is high time that they invested in both livestock and crop farming,.

“The goats and sheep can scavenge in the harsh environment,” Mr Odongo reasons.

 He says the once good environment that defined Teso has heavily been depleted and it is one of the reasons for the altered rainfall patterns.

“There is a need for soul searching among people of Teso, and deliberately focus on a greening campaign like we have started in Ngora with over 20,000 trees donated by Roofings Group and Centenary Bank. This is one of the mechanisms that may enable farmers to manage to retain water in the soil,” the district chairperson advises.

Mr Stephen Ochola, the Serere District chairperson, says the ultimate answers lie in livestock farming.

“If you can’t find Shs10m in growing cereal crops, you can find that in only three fattened animals and you will readily be able to have your children at university,” he says.

Contradiction

While agriculture is the backbone of Uganda’s economy and employs more than 70 percent of the population, most farmers practice it without any training, something that has limited their opportunities of transitioning to large-scale merchandised commercial agriculture. In the new budget (2024/25 budget), the government reduced the allocation to the sector by 37 percent from   Shs1 trillion last year to only Shs644.39b. This budget allocation is already far below the required 10 percent allocation to the sector agreed under the 2003 Malabo declaration.

Original Source: Monitor

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FARM NEWS

Strengthening Small-Scale Farming in Uganda through Farmer Field Schools.

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By Witness Radio and ESSAF teams.

In Uganda, the shortage of desired and high-quality plant genetic resources remains a barrier to small-scale agriculture and threatens food and nutritional security, yet small-scale farmers are known for being the highest producers of the world’s food.

Indigenous seeds are vital for ensuring food and nutrition security and play a crucial role in sustainable agriculture. Small-scale farmers rely on farm-saved seeds obtained through farmer-managed seed systems (FMSS).

On the 6th of June 2024, the Eastern and Southern Africa Small Scale Farmers Forum (ESSAF-Uganda) organized a webinar to explore the impacts of participatory plant breeding using the farmer field schools on upholding the farmer-managed seed system in communities.

In this webinar, participants shared the impacts of Farmer Field Schools (FFS) on small-scale farmers’ access to and use of quality seeds and discussed existing opportunities for FFS to upscale their seed work, thereby enhancing farmers’ income and livelihoods.

According to the Food and Agriculture Organization (FAO) of the United Nations, a Farmer Field School (FFS) is an approach based on people-centered learning offering space for hands-on group learning, enhancing skills for critical analysis, and improved decision-making by local people. FFS activities are field-based, and include experimentation to solve problems, reflecting a specific localized context.

According to Ms. Margaret Masudio Eberu, the National Vice Chairperson, ESAFF-Uganda Chapter, revealed that seeds have transformed into commercial proprietary resources due to technological advancements, market influences, and evolving legal systems forcing small-scale farmers to shift from active producers to passive consumers of industrial goods, including seeds, with modern agricultural practices.

Please find the rebroadcast here:

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FARM NEWS

National Coffee Forum Petitions Parliament Over UCDA Merger

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Coffee stakeholders through National Coffee Forum say UCDA merger will disrupt the coffee sub-sector. Coffee is one of the leading sources of foreign exchange for Uganda

Coffee stakeholders through the National Coffee Forum – Uganda (NCF – UG) has petitioned Parliament through the Speaker over the proposed mainstreaming of Uganda Coffee Development Authority (UCDA) into Ministry of Agriculture, Animal Industry and Fisheries (MAAIF)

The government plans to merge a number of Agencies to the line Ministries in a move aimed at saving about Shs1 trillion annually. If the move succeeds, UCDA will be taken to MAAIF.

However, coffee stakeholders through NCF – UG say that they find the proposal to take UCDA to MAAIF untenable and detrimental to the coffee sub-sector.

NCF-UG is a private foundation whose membership includes farmers, processors, exporters, roasters, brewers and researchers, among others.

The Forum Chairperson Francis Wakabi says that mainstreaming the entity will negatively affect the achievements Uganda has attained in coffee production and export.

“This decision will negatively affect our access to the international market and will stunt Uganda’s economic growth opportunities by distorting the functions of UCDA that have stabilized the industry over the years,” said Wakabi in a petition dated February 21, 2024. The petition was copied in to the Chairperson of Parliament’s Committee on Agriculture, Animal Industry and Fisheries as well as all MPs.

He adds that Uganda should not risk its achievements by tampering with UDCA that is the main contributor to our coffee success story.

“Mainstreaming it would therefore disrupt the many livelihoods that depend on the industry and adversely affect the badly needed foreign exchange for the country,” the petition reads in part.

As a result of UCDA coffee regulation, Wakabi says that Uganda’s competitiveness was elevated on the global market, ensuring high quality Uganda coffee and enabling Uganda’s coffee to displace that of Brazil and India in Italy and UK coffee markets.

“… World over, coffee is supervised and regulated by a specialized body like UCDA for purposes of institutional memory and specialized focus. Experience from Ethiopia and Kenya who disbanded their specialized coffee authorities and mainstreamed them back into the relevant ministries had to reverse their decisions after registering negative outcomes,” said Wakabi.

The Forum further says that the European Union (EU) buys over 60% of Uganda coffee, making it the biggest market for Uganda.

“The EU has introduced a new regulation called the EU deforestation regulations (EUDR) which bans export of coffee from deforested land, taking effect from 2025. This calls for farmer traceability and the EU commission in Uganda is already working with UCDA to implement the said regulations. They require a country to constantly monitor deforested areas and map all the farmers for purposes of implementation of the farmer traceability program to maintain a high standard of quality. It was reported that Uganda has achieved most of the requirements under the EUDR and required a few steps to be declared compliant. Monitoring and implementing the scheme for the millions of farmers is a tedious activity which requires a specialized unit that can be best implemented using the already established structures of UCDA. Disrupting the current UCDA structure will not only halt the progress made in achieving compliance, but also risk reversing the gains made,” added Wakabi.

He avers that UCDA has been able to greatly contribute to Uganda’s improved Coffee quality through implementation of programs such as certification of Coffee nurseries to ensure quality of planting materials, Provision of Coffee specific extension services and agronomy to improve production and productivity, Provision of technical expertise in Coffee rehabilitation, post-harvest handling practices and pest and disease management and provision of coffee processing equipment like wet mills to farmers and cooperatives to improve quality and promote value addition. The coffee stakeholders are worried that once UCDA is taken to MAAIF which is loaded with many crops and projects, coffee, a key source of foreign exchange for Uganda may not get the necessary priority. Coffee stakeholders argue that if indeed Parliament is a people-centred institution, it should listen to the views of farmers and other stakeholders and retain UCDA as a semi-autonomous agency.

“Given the above position with the attendant reasons, the NCF advises that the proposed mainstreaming of UCDA into MAAIF should not be implemented and that the proposed Bill No. 30 (part VII) be dropped in order not to disrupt the industry and the progress made under the stewardship of UCDA. All coffee stakeholders are unanimously in agreement with this position,” reads the petition in part.

Source: businessfocus.co.ug

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