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Profile for Agriculture Animal industry and fisheries sector

Background

The sector comprised of three sub-sectors of crop , animals and fisheries  resources  is a backbone of Uganda’s economy  employing approximately 69% of the population and contributed about  21 % to the GDP in FY 2017/18  and 24.5 % in FY 2016/17.  Uganda’s export in 2017 stood at US$ 3.4 billion with the sector contributing over 70%  of the exports.

The sector is under the Ministry of Agriculture, Animal Industries and Fisheries (MAAIF) that is guided by the Agriculture Sector Strategic Plan (ASSP) 2015/16-2019/20. Under the National Development Plan 2, there is an emphasis on the importance of agro processing and value addition of Uganda’s  key cash crops include cotton, tea , flowers,  coffee , tobacco and cereals among others.  Investment opportunities in  the sector  are vast, ranging from production,  processing, marketing and development of supporting infrastructure.

The sector is a major contributor to the national economic growth, investments, industrialization, economic diversification and job creation, poverty reduction, food security, export and has led to improvement of people’s livelihoods and the socio-economic transformation of the country. The agriculture sector is also prioritized in the Vision 2040 and National Development Plan (NDPI and II) as a growth opportunity that will spur Uganda’s socio-economic transformation into middle income status by 2040. The government identifies agriculture as a vital contributory growth sector capable of reducing poverty and stimulating economic growth.

Priorities in the sector

The government  during FY 2018/19  plans   to address the following challenges that prevent optimal production in the sector;

  • Addressing the effects of climate change as agriculture depends of rain;
  • Supporting investment in processing of agricultural output;
  • Support the establishment of post harvest storage;
  • Address the security tenure of land and
  • Establishment of agricultural insurance scheme.

The Crops

The major crops in the sub-sector include maize, millet, sorghum, rice beans, groundnuts, simsim, cotton, Irish potato, coffee, sweet potato, cassava and bananas. These crops are majorly produced by the households on a small scale.  However, commercial farmers have started venturing into the subsector to take advantage of the opportunities offered by the subsector.

The seed producers are only able to meet about 20% of farmers’ seed requirements. Therefore about 80% of the seed demand is met by the informal sector. The seed from the informal sector tends to be of low quality which ends up negatively impacting on the productivity of the sector. Uganda has 23 seed companies which are active in the seed market mainly dealing in hybrid maize as a major product. They also produce and market quality seed of other improved varieties of crops. On the marketing side the seed producers distribute their seed through more than 2300 registered agro dealers.

Uganda processes less than 15% of the agricultural produce, which makes the farmers fetch little value for their produce. There are however a number of small scale processors involved in processing maize, millet, groundnuts, soya, cassava and timber among others which have mushroomed across the country. The small-scale agro-processors are faced with a lot of technical and capacity challenges and produce products generally of much lower quality.

Uganda currently exports a wide variety of unprocessed crops albeit in low quantities and most times with challenges of quality. Among key export crops are cut flowers, plant cuttings as planting materials, chili, okra, baby vegetables, vanilla, sun-dried tropical fruits and papain from papaya, and green bananas.

Forestry

Uganda’s natural forests have been depleted through illegal and unsustainable harvesting practices.                             According to the U.N. FAO, 15.2% or about 2,988,000 ha of Uganda is forested.   Between 1990 and 2010, Uganda lost an average of 88,150 ha or 1.86% per year, leading to a loss of 37.1% of its forest cover estimated at around 1,763,000 ha. The government has not yet adequately addressed the rate of forest depletion. Government projects that the national target for plantations should be 75,000 hectares of commercial timber plantations by 2025 which translates to planting needs of 3,500 hectares per annum. There is current acute shortage of timber which has led to increases in timber prices. The good prices of timber has attracted a number of private sector players to invest in the subsector.

Fisheries sub-sector

The sector is the second largest export hard currency earner for Uganda after crops and it employees over 700,000 people. The sector with annual fish catch of 230,000 tones depends on the various natural water bodies of Uganda.

According to MAAIF the country has an existing fish supply deficit of 180,000 tons (MAAIF, 2012), while Food and Agricultural Organization (FAO) puts it at 300,000 tons annually. This implies that there is need for 400 to 600 million fingerlings annually if aquaculture production is going to address the existing gap. It is currently estimated that Uganda produces not more than 80 million fingerlings annually from both private and public hatcheries which is less than 20% of the annual demand. This means there is a gap of 300 to 500 million of fingerlings annually.

Similarly there is   a gap in supply of fish feed of 400,000 to 600,000 tons of fish feed annually. Currently the country through both private and public fish feeds producers produces less than 100,000 tons of fish feeds annually living a gap of about 500,000 tons of fish feeds.

The business opportunities to exploit in this area include production of fish fry, fingerlings, fish feed, fish cages and tanks in addition to engaging in fish farming, fish processing, fish restaurants and aquarium and agro-tourism centre.

The fish cages are feasible as approximately 18% of Uganda’s land surface of 236,040 km2 is covered by fresh water through rivers and lakes.

The statistics from the National Fisheries Resources Research Institute (NaFIRRI) in Uganda indicate  fish export volumes fell from 39,000 metric tonnes in 2005, to 17,600 tonnes in 2014, leading to decline in earnings from exports from $143.6m (sh515b) to about $88.14m (sh317b) respectively. Since 2014, annual earnings from fish exports are between $50m (sh180b) and $80m (sh288b). The country  has been earning about sh4.6b in levy collections from fish industries since 2013, but the figure has fallen to about sh3b. About 70% of the workers in fish factories, according to statistics from the agriculture ministry, lost jobs between 2005 and 2013 due to the closure of factories.

Livestock

Livestock sub-sector

The livestock sub-sector plays an important role in the livelihood of approximately 1.7 million households who keep cattle as a reliable source of income, household nutrition, food security and employment.  However, majority of livestock farmers in Uganda keep animals for safekeeping of their wealth and not necessarily for commercial purposes. The following are the Livestock census figures as reported by Uganda Bureau of Statistics (UBOS) in 2008.

Species Cattle Goats Sheep Pigs Chicken Turkey Ducks
No. 000 11,408 12,449 3,410 3,184 37,385 348 1,458

Economically, cattle are considered to be the most important livestock in Uganda followed by the small ruminants (goats and sheep), piggery and poultry which are also equally important as there a number of households which do not keep cattle. Over 90% of the animals and poultry of Uganda are indigenous with slow growth rates which have a negative impact on the output of the sector.

Dairy Cattle

Uganda has an estimated number of 1.6 million dairy cattle with estimated growth rate of 4% per year. The diary subsector is pasture-based and a low cost output   production system.  The animals    produce an average of about 1.85 million litres of milk per day giving  8.5 litres of milk per week  which translates into 675 million litres of milk per year.

There are 13 registered large scale milk processors  in Uganda  with  a    combined capacity of 821,000 litres of milk per day  or  300 million litres of milk per year  leaving  a balance of  over 375 million litres of  unprocessed milk  to be sold through the informal milk sector. Therefore over 50% of unprocessed milk is sold on the market at low prices   hence denying the farmers the chance of fetching better prices from selling processed milk.  (NLC 2008).  The per capita consumption of milk products is 58 litres per person per year which is low when compared to 100 litres per person per year in Kenya or the 200 litres per person per year as recommended by FAO.  The per capita consumption can increase especially in urban areas and schools if processed milk is made available at affordable prices.

 Beef cattle and goats

The supply of beef cattle stood at 9.8 million animals with estimated growth rate of 4% per year (UBOS, 2008). The supply is constrained by the largely subsistence cattle keeping system which depends on slow maturing indigenous breeds and free range feeding. The indigenous breeds including Ankole longhorn, the Karamojong and the shorthorn Zebu among others account for over 90 % of the beef cattle. Pastoralists and communal grazers hold about 95 percent of all the cattle. Approximately 99% of goats in Uganda are indigenous, dominated by the Mubende breed and about 1.3 percent are exotic. The population of goats was estimated at 13.2 million in 2010 of which 98.7% were indigenous. The sheep flock is dominated 99.2 % by indigenous breeds and the exotic/cross breeds are only about 0.8%.

Demand for beef is growing ahead of supply resulting from increasing urbanization and purchasing power, changes in consumption habits, and the fast rate of population growth (NLC 2008). The urban population is 4.4 million and is growing at the rate of 4.4% per year (World Bank 2010). The Uganda population is 35 million and is growing at the rate of 3% (UBOS 2014). Therefore the growth in the cattle herd of 4% is not enough to maintain the per capita consumption of beef of 12 kg per person per year for the growing population. The current per capita consumption of Uganda is below the recommended consumption quantity of 50 kg per person per year by FAO.  The national consumption level of beef is estimated at 230,000 tones or about 2 million animals slaughtered per year. (ILIO 2012).  The demand of beef will increase if quality beef is made available at affordable prices.

Poultry

The total chicken population is estimated at about 40 million birds of which almost 90% are local breeds. Poultry keeping forms an active source of livelihood for about 3.2 million households. The supply of exotic chicken is dominated by commercial producers. The key constraints preventing increased poultry competitiveness include lack of capacity and capability by a number of farmers, high cost of quality poultry feeds and lack of consistent supply of quality day old chicks. On the supply side 48,750 tons of chicken meat were produced in 2011.

The per capita chicken consumption is about 1.7 kg per person per year when compared with South Africa per capita consumption of 32 kg per person per year. The supply for chicken eggs is at 491 million eggs translating to a per capita consumption of only 4 eggs person per year when compared to 145 eggs per person per year in South Africa.  The demand for chicken meat is growing at 3% per year due to Uganda’s growing population and the demand from the region.

The barrier to increased demand   of both chicken meat and eggs are the high prices in the market as chicken meat is more expensive than fish and beef.

The demand for dressed chicken meat and the chicken meat products like sausages is on the increase mainly in urban areas where it is not possible to rear chicken. The demand is more enhanced by growing number of supermarkets and fast food outlets (ILI0 2012).

Players in the sector

The agricultural sector is dominated by small (peasant) farmers that primary grow foods crops for their   subsistence with the balance if any for sale. A number of the peasants also grow   cash crop and practice livestock farming on a small scale.  Farming is gradually becoming mechanised although the bulk of cultivation is still done by hand using a hand hoe and panga or cattle driven ox ploughs.  Cash crops including tea, palms, rice, and sugarcane are grown in plantations. There are a few farmers that are also growing food crops like maize and cassava on large scale.  There are also a few farmers that have started engaging in fish farming in fish ponds or fish cages on large scale.

Statutory institutions

The following important statutory institutions in the sector report to the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF) for policy guidance.

  • National Agricultural Research Organisation (NARO);
  • National Agricultural Advisory Services (NAADS) for delivery of advisory services;
  • National Animal Genetic Resource Centre and Data Bank (NAGRC&DB) for animal genetic development;
  • Coordinating Office for the Control of Trypanasomiasis in Uganda (COCTU) ;
  • Diary Development Authority (DDA) for promotion of Dairy development;
  • Uganda Coffee Development Authority (UCDA) for promotion of coffee development;
  • Cotton Development Organisation (CDO) for promotion of cotton development;
  • Plan for Modernisation of Agriculture Secretariat (PMA)

Demand for agricultural produce

Demand for agricultural produce is as a result of the following:

  • Local, regional and global population growth
  • High urbanisation rate
  • International demand for organic agricultural commodities
  • Changing dietary needs
  • Demand for bio fuels
  • Rise in per capita income
  • Demand for ethical products
  • Food purchases by humanitarian organisations like World Food Programme
  • Government policy to improve the sector.

Uganda is endowment

  • Fertile Soils

About 65% of Ugandan soil is suitable for agriculture and the fertility of Uganda soil is summarized as follows:

Soils                                             Percentage of land

Soils of high productivity                8%

Soils of medium productivity         14%

Soils of fair productivity                43%

Soils of low productivity                30%

Soils of negligible productivity        5%

  • Temperatures

All year round sunshine with moderate temperatures

  • Rainfall

Uganda’s rainfall ranges between 500mm to 2500 mm and the rainfall regime allows two planting and harvesting seasons a year in most parts of the country, without the use of irrigation.

  • Fresh water

Many lakes and rivers with sizeable stocks of aquatic life and the availability of water create opportunities for irrigation and fish farming.

  • Regional demand

Uganda is surrounded by neighbouring countries that create effective demand for the   produce.

Agricultural sector access to markets

In FY16/17 Uganda expects to benefit from the implementation of the Nairobi Package under which all signatories (which include developed countries) are expected to abolish export subsidies for farm produce. Implementation of this agreement is expected to benefit local production by increasing competitiveness of local agricultural produce on both the domestic and international markets.

Challenges facing the sector

  • Climate change resulting from the destruction of wetlands and deforestation;
  • Low survival rates of distributed seedlings currently estimated at about 40%;
  • Inadequate post-harvest handling infrastructure;
  • Inadequate compliance with and enforcement of standards right from farms to processors;
  • High cost of financing for agriculture enterprises ;
  • Lack of coordination among institutions in the agricultural sector.
  • Limited markets and market access and related marketing infrastructure;
  • Lack of linkage between research and farmers,
  • Low use of fertilizers,
  • Low coverage of irrigation,
  • Land fragmentation,
  • Low level of value addition,
  • Lack of agricultural machinery,
  • Lack of effective control of vectors and diseases,
  • Poor transport network.

The information on the sector is organised as follows;

Animal Sub-sector
Coffee Sub-sector
Crop Sub-sector
Fisheries Sub-sector
Forestry Sub-sector
Irrigation in Uganda
Labour For Agriculture in Uganda
Land in Uganda
Value addition
Organic farming
Supporting infrastructure
Challenges faced by the agricultural sector
Investment opportunities in Agriculture Sector in Uganda