Transcript Executive Manager, Uganda Coffee Farmers Alliance

The role of farmer organizational development in
profitable coffee production
Presented by Tony Mugoya
Executive Manager, Uganda Coffee Farmers Alliance
Brief history of coffee in Uganda
• Many species of coffee
especially Robusta coffee are
indigenous in Uganda.
• Historically, coffee had cultural
significance in most parts of
Uganda.
• Commercial production of
coffee in Uganda started at the
beginning of the 20th Century.
• In Uganda most of the coffee is
grown by smallholders (over
1,000,000
households)
in
small plots where it is often
mixed with other crops such as
bananas.
Brief History of Coffee Extension in Uganda
• The public extension system
evolved from regulatory
services (coercive),
progressive farmers’ schemes
(persuasive), to unified,
decentralized and demand
driven approaches.
• Private extension approaches
included commodity based and
farmer led extension systems
such as Farmer Field Schools.
• Coffee production is dominated
by smallholders who face
many challenges.
Main challenges faced by smallholders preventing
business development and competitiveness
Knowledge
 Lack of adequate agronomic training
 Lack of a clear understanding of the value chain
 Lack of market information
 Lack of business, marketing and technical skills (Farming as a
Business)
Size
 Individually they are too small to access the important services that
are critical for developing their enterprises (Inputs and Finance)
 Low volume of produce results in very weak bargaining position and
limited market access
 As a result their most likely “business” partners are the middlemen.
This has created a very strong dependency on middlemen for
market access and for finance
Challenges faced by smallholders are best resolved
through Farmer Organizational Development
 To empower farmers to create economic opportunities
 To provide farmers ownership and decision-making
 To enable market access and participation in the value chain
 To enhance bargaining power and achievement of economies of scale
 To make smallholders attractive to service providers
 To encourage “farmer to farmer” learning
 To give farmers a voice - to engage in dialogue with other
stakeholders
 To strengthen the self help potential of coffee communities
Organizational Development Process and Structures
Producer
Organization (PO)
Depot Committee
(DC)
Uganda Coffee
Farmers Alliance
25 - 35 Farmers
Approx. 20 POs
Association of DCs
Area
Village Level
Parish Level
National Level
Key
Mobilization
Coordination of PO activities
Coordination of DC activities
Functions
Extension
Bulking
Value addition
Market access
Collection of Coffee
Entry point for new Farmers
→
Coffee logistics
Quality control
Marketing
Link to service providers
→
Capacity building
Strategic partnerships
Representation
Code of conduct
Key Roles
Executive Committee
Executive Committee
Board of Directors
Lead Farmer
Control Committees
Executive Manager
Demo Holder
Marketing manager
Support staff
FFS Host
DC Extensionist
FFS Facilitator
Farmer Organization Requirements for Performance
Value Chain
Services
Market
Information
Inputs
Supplies
Extension
Services
Market
Linkages
Farmer
Organization
Financial
Services
Improved access to extension training
• Demonstration plots
where farmers in a group
learn about the effect of
GAPs on yields.
• Farmer Field Schools
where “farmer to farmer”
learning occurs.
• Technology Development
Sites where farmers
analyze local innovations.
• Groups enable farmers to
effectively demand for
appropriate training.
Input Use enable increase in yield
• Fertilizers are crucial for significantly improving yields
Average production on
demonstration plots has
increased from 0.6
MT/Ha of green coffee to
about 2.7 MT/Ha through
the application of
fertilizers and other good
agricultural practices
Improved access to markets
• Farmers Organizations
enable bulking of
members coffee.
• Farmers Organizations
create opportunities for
value addition.
• Farmer Organizations
enable achievement of
economies of scale.
• Farmer Organizations
enable achievement of a
collective bargaining
power.
Improved access to financial services
Farmer Group Finance
 Marketing operations
financing (for value addition
and logistics)
 Input stocking financing
Individual Finance
 Household needs financing
(medical expenses and
school fees)
 Input purchase financing
Improved participation along the value chain
Through the 5 Value Options by farmers:
• Acquiring greater value through improved
planting materials, adopting GAPs and engaging
in sustainable practices.
• Retaining value through local service provision
and taking up more value chain roles.
• Adding value through processing and
extending higher up in the value chain.
• Creating value through new product lines e.g
coffee extracts and selling husks.
• Distributing value to women and youth by
encouraging their active participation.
Combined effect of value addition and yield improvement on net
income – Average Farmer with 300 coffee trees
Selling point
Production (Kg dry
cherry per tree)
Non
Member
low yield
Alliance
Member
low yield
Alliance
Member
average yield
Demo Plot
(full GAP)
high yield
Farm
Gate
Exporter
Kampala
Exporter
Kampala
Exporter
Kampala
1
1
2.2
4.5
Production Cost (USD
per tree)
0.19
0.19
0.39
0.78
Net farmer price
(USD/Kg)
0.78
0.96
0.96
0.96
Total Cost (USD)
57
57
117
234*
Total Income (USD)
234
288
634
1,296
Net Income (USD)
177
231
517
1062
31%
192%
600%
% Increase in Income
* Total cost includes interest (Over 20% per annum) paid on USD 125 loan for fertilizers
UGANDA COFFEE FARMERS ALLIANCE
“Improved livelihoods for coffee farmers in Uganda.”
Farmer Organization Development is the
key to livelihood improvement for
smallholders and their transformation into
commercially oriented farm entrepreneurs.
“Emwanyi bwe bugagga!”
“Coffee is wealth!”
Visit the UCFA Stall Number 65 in the Exhibition Area for
more information.