Value Chains: Supporting inclusive markets in agriculture and trade to improve lives of farmers in Uganda

Value Chains: Supporting inclusive markets in agriculture and trade to improve lives of farmers in Uganda
Grace Lawilu, 49, is a rice farmer in Vokogali village, Gulu district. She is part of Palaro Owalo Growers' Cooperative which has benefitted from financial training, and business linkages from the UNDP-supported project on Development of Inclusive Markets in Agriculture and Trade (Photo credit: UNDP/Edga Batte

GULU - Grace Lawilu wakes up at cockcrow every day and heads to the garden to plant seeds, dig out weeds or harvest.

Vokogali, her home village, is 55 kilometres from Gulu town, in Northern Uganda, and is close to Nimule on the border with South Sudan. Scattered homesteads made up of mud and wattle huts, separated by green thickets and walkways, make up this largely undeveloped expanse of swampy grassland.

Key Highlights

  • The Development of Inclusive Markets in Agriculture and Trade (DIMAT) project funded by the United Nations Development Programme (UNDP) is contributing to Uganda’s current agriculture Development Strategy Investment Plan (DSIP) by helping to increase market access and value addition for products.
  • Enterprise Uganda, and Kilimo Trust, an agricultural development organisation working across East Africa, are jointly implementing the DIMAT project, which has been running since October 2011 and is ending in December, 2014.
  • The project works mainly with smallholder farmers in the rice, beans, and cassava commodity sectors.
  • Farmers are trained in good farming practices, including post harvest techniques, to ensure they get high yields and a fair price for their produce.

This is where Lawilu has lived for the last 35 years as a farmer, mother and wife. Over the years, the work and sweat of her hands have rewarded her with the satisfaction of fending for her family of 10; five daughters, three sons and a husband who occasionally joins her in the garden to harvest or spray the crops. Although she is majorly a rice grower, she also cultivates other crops to diversify her income. On average, Grace earns about Ugshs900,000 from each harvest which she uses to take care of her family and for investment. She says, she has been able to construct two huts and a granary in her homestead, and to provide an education for her children.

“Supporting my children in school is no mean feat as I am also the family’s bread winner. I plan to construct a better home for my family and this will be from my savings at the Village Savings and Loan scheme,” she explains.

Grace is one of 253 members of Palaro Owalo Growers Cooperative - two thirds of them women. Since joining the Cooperative, Grace has found a new reason to work even harder. “I feel energised to work more because I can save with fellow members and this money can help me start up a personal project that can improve my family’s life,” she says as she bends to uproot weeds from her rice garden.

The cooperative’s Secretary General, Matthew Abwoch, says that they have been able to sell their produce as a group which enables them to get a fairer price than if they were to trade as individual farmers. Initially, Abwoch says each farmer would sell a kilogram of maize at Ugshs 300. The group however now sells each kilogram at Shs1,000.

Abwoch and Lawilu attribute this success to a number of trainings in capacity building and resource mobilisation provided by the Development of Inclusive Markets in Agriculture and Trade (DIMAT) project funded by the United Nations Development Programme (UNDP). The US$ 2.6m project aims to address the challenges cited in Uganda’s current agriculture Development Strategy Investment Plan (DSIP), particularly increasing market access and value addition for products. To gain a footing in international markets, small producers often need support to boost the quality and competitiveness of their goods. Enterprise Uganda, and Kilimo Trust, an agricultural development organisation working across East Africa, are jointly implementing the DIMAT project, which has been running since October 2011 and is ending in December, 2014.

Anthony Mugambi, Programme Officer of Kilimo Trust, and Team Leader for DIMAT for Northern Uganda, explains that in the region, Kilimo Trust is working with two market off-takers or buyers, for beans and rice. The major one is the rice off-taker for rice seeds, Equator Seeds Limited, which is currently linked to nine farmer cooperatives in Amuru, Gulu and Nwoya districts.

“Before the project started, we carried out a value chain analysis of five commodities; rice, beans, cassava, honey and coffee. Later on, the Technical Advisory Committee of DIMAT selected three commodities-rice, beans and cassava, based on carefully selected criteria such as market potential, inclusiveness of the poor and division of labor among other development partners.

“Following the analysis, we did a stakeholders’ mapping in which we interviewed exporter, producer organizations and other value chain actors to determine their roles and opportunities they offered along the value chain,” says Mugambi. He adds, “The project also profiled potential market-off takers to gauge their capacities to do business with the smallholder farmers and their readiness to offer competitiveness market prices for their commodities.”

Walter Ross Ojok, Equator Seeds’ Production Manager says that they are dealing with more than 30,000 farmers in cooperatives and groups. These farmers however, are given training before they are allowed to buy the rice seeds, which costs UgShs3, 000 per kilogram. Through the capacity building, farmers are taught good agricultural practices targeted at production, all the way up to post harvest handling practices to ensure that whatever they produce is of good quality and is guaranteed a premium price. The farmers are also taught about group dynamics since most of them are in groups and cooperatives.

Robert Oloya is a bookkeeper at Alero Labara Cooperative Society which he says has helped farmers sell in bulk and get better prices for their produce.  He says, “We would like farmers to earn the best price and better their living standards. Other markets offer a lesser price”. “We follow agronomic practices. We have a field extension worker who moves among the farmers to teach them good farming practices. We then connect them to Equator Seeds for good quality seeds to plant. These are seeds that have been approved   by agronomic workers too. These are improved and clean seeds which are of high quality and assured germination. We also train them on how to manage the crops, to the harvest time and up to the time they stock”, Oloya adds.

Jackson Lakor is the District Agricultural Officer (DA0) of Gulu and explains that Kilimo Trust and Equator Seeds have contributed to agricultural growth in the Northern region. He observes that within a short time the district has seen a lot of improvement especially in the capacity of the farmers’ associations and farmer cooperatives.

“Farmers have been trained and they are able to do a lot of things on their own. We have seen improved production especially for rice within a short time. We are seeing an impact which we think can be sustained with support perhaps from the district and other partners,” he explains.

Lakor says that the production of rice in Gulu is now at about 5,000 hectares and projects it to grow to between 10,000 and 15,000 hectares in the next two years. He observes, “What is remaining is to strengthen the aspect of marketing which needs to be improved so that people are able to realise the benefits from the good linkages and from this, we will be able to register a big increase in production of rice, maize and other cereals in the district.”

By ensuring that farmers obtain good prices for their produce, rural communities that would otherwise have been left on the periphery in the participation of trade, are given a chance to prosper and to develop. Likewise, the market off-taker, Equator Seeds Limited, is assured of guaranteed supplies in terms of quality and quantity. Most of all, even after the project ends, Equator Seeds and the farmers can continue working for mutual win-win benefits. Mugambi says that a number of farmers have approached banks and other financial institutions to access financing using the supply contracts that they have signed with Equator Seeds Ltd as guarantee that they have market for their produce.

“We are building the capacities of the farmers in the areas of agronomy, post-harvest handling and group dynamics,” adds John Okello, Managing Director and founder of Equator Seeds. The company, which was started with a start-up capital of Ugshs300, 000 is now worth UgShs1.5bn.

“With my savings I have been able to buy four oxen, each at Shs800, 000. I bought them to ease my farm work. They are efficient at ploughing. The work of an ox in two days can be done by one man for a month,” 52-year-old Abwoch explains.

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