Uganda cotton industry back in the doldrums

By MUBATSI HABATI
Published September 20, 2009

Cotton was Uganda’s second most important cash crop in 1950s, ‘60s and ‘70s, after coffee, accounting for up to 25 percent of foreign exchange. But today, the ‘white gold’, as it was then described, accounts for less than 5 percent of the country’s foreign exchange earnings.

And the trend is getting worse. According to the Uganda Export Promotion Board (UEPB), cotton export revenues dropped from US $50 million in 2004/5 financial year to $38m in 2007/8. At the same time, figures show a declining trend in production of cotton seeds from 94,000 tones in 2002, to 39,000 tones in 2008.

In 2007, statistics from the Ministry of Agriculture, Animal Industry and Fisheries show a successive decrease in the value of exported cotton, and its contribution to Gross Domestic Product (GDP). For example, cotton exports’ contribution to GDP was 6.4 percent in 2004; 3.5 percent in 2005; 2.1 percent in 2006; and 1.5 percent in 2007.

Busoga, Acholi, Lango, Teso, and Bukedi (now known as Tororo, Pallisa, Budaka and Busia districts) in Uganda were major cotton growers in 1950s through to the ‘70s, and ‘80s, but today not much cotton is grown in these areas. Western Uganda, which used to produce less cotton has now taken the lead. Kasese, Kamwenge, and Bushenyi districts in Western Uganda; and Kamuli, Kitgum, Katakwi, and Lira districts in Northeastern Uganda, now produce all the country’s cotton.

Even in such areas, production is nowhere near those of the ‘70s, and ‘80s. Ginneries in the old cotton belt closed shop long ago. Many defunct ginneries in Kasese, Lira, Apac, Tororo, Kamuli, Pallisa,and Gulu bring memories of the past when they processed seeds into oil, soap, and employed people. Current figures indicate that the northeast, northwest, and parts of eastern Uganda top the country’s poverty list.

Analysts say if carefully incorporated in the Prosperity for All, and National Agricultural Advisory Services (NAADS) programmes, cotton is a powerful weapon against poverty in the old cotton belt. The same call was made by Cotton Development Authority’s Executive Director, Ms Jolly Sabune, a few years ago.

“If the right policies are put in place, and the marketing is good, Uganda’s 50 percent subsistence farming community can depend on cotton as a cash crop and this would go along way in poverty eradication,” she said.

But NAADS Secretariat Communications Officer, Alice Nakagwa, admitted that NAADS services are only received by cotton farmers in Lira and Kitgum districts, which imply many Ugandan cotton farmers are not benefiting from the program.

So what has gone wrong?

According to information on the CDO website – the statutory body overseeing the sector –wars, pest, and diseases, unstable international market prices, and drought are responsible for the decline in cultivation of cotton in Northern and Eastern Uganda.

Mr. Okaasi Opolot Sidroms, commissioner of crop production and marketing in the Ministry of Agriculture concurs with CDO. He says the LRA war in the north, irregular weather patterns, fluctuation in world cotton prices, and liberalization have negatively affected Uganda‘s cotton production.

“The figures of cotton production before liberalization show that cotton growing was high,” says Mr. Okaasi, “but now so many enterprises compete with cotton in areas that used to be known for cotton. Sorghum and rice in the east, and north are taking the lead because of better returns and prices.”

But stakeholders and cotton farmers blame the low prices and collapse (closure) of co-operative unions for the declining cotton production.

“The decline of ginneries, formerly owned by corporative unions or individuals is responsible for reduction in cotton production,” says Tayebwa Bernard, agribusiness manager of Uganda Co-operative Alliance, adding that cotton is not a good crop for smallholder farmers because unlike crops like maize, it requires intensive labour, pesticides, and other farm implements which they cannot afford.

Farmers blame CDO for lack of innovative approaches to boost cotton production, and for meddling in their dealings with ginners and buyers. However, CDO says cotton farmers have also stopped growing organic cotton because of government’s strict conditions on intercropping.

Be that as it may, this year’s crop might easily become the worst in recent years. Reports from cotton growing areas indicate that farmers are planting less cotton due to lack of seeds because ginners in the country prefer to hoard them for oil processing and not for planting. So the planting season from May to August 2009, elapsed before farmers planted enough cotton.

But even with the seeds mobilized for emergency, CDO is uncertain of quality.

Uganda is the only African country exporting raw organic cotton. Farmers now sell one kilogramme of cotton between Ushs600 (US$0.3 and Ushs900 (US$0.45), up from Ushs450 and above the government’s price of Ushs700 (US$0.35).

Cotton production is dominated by small-holder farmers, whose productivity is hampered by lack of quality seeds, spray pumps, pesticides, fertilizers tools, and managerial factors. Mr Tayebwa suggested that rejuvenating ginneries, and mobilizing farmers will increase cotton production in the country.

Mr. Okaasi argues that “although ginners are providing some incentives to cotton farmers, it needs a big push to mobilize farmers to grow more.” He said farmers tend to go where they get more food and money, adding that government should offer subsidies to them.

He added that the new cotton growing areas like Kasese, Bushenyi, and Kamwenge have been receiving interventions, subsidies and mobilization from international agencies, and government.

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