Despite its high coffee export volumes, Uganda has a low profile and questionable reputation in the global market — but the country aims to gain greater recognition internationally, improve quality, expand production and increase exports in all coffee sectors, and has outlined an ambitious ‘coffee roadmap’ to accomplish this. By Vanessa L Facenda. All images courtesy of the author
Uganda is the largest coffee exporter in Africa and the eighth largest exporter of coffee by volume in the world, yet when it comes to coffee-producing countries in Africa, Uganda is not the first one to come to mind. But the ‘Pearl of Africa’ is working diligently to change that.
Uganda is focusing on doubling its total agricultural exports from USD $6.629 billion to USD $12 billion by 2027. Odrek Rwabwogo, chairman of the Presidential Advisory Committee on Exports and Industrial Development (PACEID), in a presentation to an international group of journalists on a government-sponsored media tour of Uganda earlier this year, said that coffee is a top target for growth. PACEID advises President Yoweri Museveni on ways to improve and increase Uganda’s export potential in a variety of sectors.
Historically, Uganda coffee has been used for blending and not identified, but the country wants to change that by improving quality. Within coffee, Uganda’s current exports are around $627 million annually, with the goal in five years being $1.5 billion — a 28 percent increase. Rwabwogo said that further goals include growing annual coffee production from approximately seven million bags to 20 million bags by 2030.
Currently, Uganda’s major coffee export is robusta. In August, its exports rose by 48.4 percent to 0.74 million bags from 0.5 million bags in August 2022, per the International Coffee Organization. This represents the second largest monthly exports on record, just behind the 0.79 million bags exported in March 1973. Although robusta is the largest export, Ugandan officials believe there is opportunity in premium coffee (arabica), roasted coffee and soluble/instant coffee.
Uganda’s Ministry of Agriculture, Animal Industry and Fisheries has stated that coffee is a “strategic commodity in the agro-industrialisation programme under the National Development Plan III (NDP III)’. It has been prioritised for the country’s march towards middle-income status and poverty eradication programme.” The Ministry reported that coffee provides the needed foreign exchange and is a source of income for 1.8 million households in the country that are involved in its cultivation.
The Uganda Coffee Development Authority (UCDA), which was established in 1991, monitors and regulates the country’s coffee industry, and advises the Ugandan government on policy issues. In addition to having the responsibility of increasing quality coffee production and productivity, the UCDA is also charged with growing domestic coffee consumption. Given that coffee has been identified as the leading commodity for growth, the UCDA has devised an aggressive roadmap –it includes nine initiatives (see chart below) – to elevate Uganda’s reputation in coffee and transform its coffee sector to achieve the stated growth goals. UCDA managing director, Dr Iyamulemye Emmanuel, said that the government is undertaking a number of measures to ensure that farmers are producing coffee that meets international market standards and requirements. He noted that Uganda is looking to export to emerging markets as well as developed markets.
Challenges to achieving growth
The goal to raise Uganda’s coffee reputation on the global stage is ambitious and the impediments to growth in most agricultural sectors are vast: overcoming long-held stereotypes, perceived low quality because of low-standard inputs (seeds, pesticides, chemicals, banned substances still being used, etc), lack of investment, no economies of scale, minimal understanding and sharing of information relating to regulations, weak cooperatives, high transportation costs (handling fees, limited infrastructure when receiving), and most commodities go to the low end of the market and take cost-cutting measure.
Within coffee, the biggest challenges – aside from the average age of a coffee farmer being 63 – are the lack of branding (coffee is rarely identified as being from Uganda versus origins that are highlighted such as Ethiopia, Kenya, Colombia, Brazil, etc), changing the mindset of the producers who view coffee as just a cash crop (most producers don’t even sample their own coffee), and the perception of the global coffee industry, which views Ugandan coffee overall as low quality — but the potential is there.
Mountain Harvest, an exporter, producer and provider of farmer services based in Mbale, aims to ‘challenge the status quo of coffee production in Uganda for the sake of smallholder farmers’ as its company mission asserts. “We want to show the market that Uganda has great coffee and that we can consistently deliver it,” said managing director, Kenneth Barigye.
Mountain Harvest produces, processes and exports organic, Fair Trade and Rainforest Alliance-certified coffee. It maintains eight processing facilities throughout Uganda, where it employs washed, natural and honey processing techniques. The Mt Elgon facilities are overseen by processing manager, Ibra Kiganda, who is also the 2023 African Fine Coffees Association barista champion. Kiganda is passionate about coffee processing and likes to experiment with anaerobic fermentation, carbonic maceration and other new techniques (using microlots grown at elevations between 1,600 and 2,200 meters above sea level).
The majority of coffee producers in Uganda grow coffee on farms that average one acre at best, typically they are smaller. Mountain Harvest teaches producers, especially women – who do the bulk of the labour on smallholder farms in Uganda – better farming methods and techniques (such as stumping, pruning, irrigation, fertilising, using organic pesticides/weedicides, etc), and is working to change their mindsets when it comes to selling their coffee. The farmers are also taught the importance of intercropping with bananas, avocados and other trees that provide shade for the coffee as well as incremental revenue.
Better livelihoods through better pricing
Mountain Harvest provides micro-financing that educates producers on savings and loans, in addition to covering expenses in the off-season. The financial training builds their capacity to manage money while creating a transaction history the future lenders will require. “We are not an NGO — we do not give handouts,” asserted Barigye, noting the 2 percent interest loans the company offers to producers. “Our hope is that after three years, the farmers can go to a commercial bank that has more money.”
The loans are ‘kick-starter financing’ for the farmers, but said Barigye, they also help build trust with the farmers so they will sell Mountain Harvest their cherries rather than process and accumulate coffee at their homes.
Farmers receive more money for their coffee – about 20 percent more – if they sell Mountain Harvest the cherries rather than the parchment but are not always willing to do so. Company COO, Nico Herr, said that many farmers will think about when they will need money for the family (school clothes, books, etc) so they will hold onto the coffee and ‘play the market’ to see if someone else will offer them a higher price. “It is degrading the crop, but you have to consider that this is the traditional way of processing coffee in Uganda,” she explained, “we’re introducing a new way to do coffee.”
Herr, a certified Q grader, shared that Mountain Harvest is also working to shed Uganda’s reputation for ‘fast fading’ coffees. Coffees that ‘tasted great’ on cupping tables in Mbale deteriorated during transportation oversees. They discovered that it was a warehousing issue.
Mountain Harvest now has one of the few climate-controlled warehouses in the country and has grown over the past few years from filling three containers of coffee annually to 11.
Recruiting youths is critical
Instrumental to the growth of Uganda’s coffee industry is ensuring that younger generations remain interested in coffee farming and not all flee to urban areas for higher paying jobs. One factor in Uganda’s favour is that although the average age of a coffee farmer is 63, more than half the population is under the age of 18.
“For us to have sustainable coffee production, we have to attract young people while their parents are still there to train them,” stressed Barigye.
The government has extension programmes but it is overwhelmed so individual companies provide these services. Companies like Mountain Harvest, Endiro Coffee and Masha Coffee, with the support of the UCDA, are teaching Ugandans – both young and old – on all facets of the coffee industry: from proper farming techniques to elevate quality and improved processing and storage methods, to better record keeping, microfinancing, quality control, and how to cup, as well as training young men and women to be baristas.
Coffee cupping at Mountain Harvest Coffee
Mountain Harvest selects the top 20 students from a local university each year to be trained in agronomy and microfinance. After six months of training and work, it offers permanent positions to the top achievers among those students. Another programme is its ‘Professional Pickers’, which hires local youth for assistance during the harvest and to do other tasks the remainder of the year.
Ugandan officials and private sector companies realise, however, that the key to growing Uganda’s coffee industry, is through women. Women in Uganda, as in many coffee (and tea for that matter) producing countries, have not had a ‘seat at the table’. Women have long been heavily involved in the labour aspect of coffee production (picking and sorting for example) but have not had the opportunities for training and education or been involved with business transactions because of conflicting familial activities.
Endiro Coffee and Masha Coffee are both female-owned and operated companies and work with women producers — training them in all segments of coffee production, hiring them, and of course, sourcing coffee from them. Mountain Harvest also taps women to be its team leaders (most farms are still owned by men) so they are also involved on the business side.
“We have found that when the women handle the money, there is more for the children for clothing and school items, for food and savings,” said Millie Drijaru, head of coffee, Endiro Coffee. Both Barigye and Sylvia Achebet, executive director of Masha Coffee echo the sentiment.
Endiro Coffee was founded in Kampala in 2012 by Gloria Katusiime as a café to provide employment opportunities to Ugandan youths. In 2014, Endiro switched from buying roasted coffee to sourcing green coffee directly from Ugandan farmers, paying them a premium for their high quality beans. It partnered with a roaster in Kampala for its blends.
Endiro started with 50 farmers that formed the Endiro Growers Bukalasi Women’s Group, which has now grown to a network of more than 500 farmers across four growers groups throughout Uganda. Endiro offers training and support, and in return is receiving higher quality coffee and greater yields, which allows it to offer farmers better prices, thereby improving their livelihoods. Endiro Coffee, which received its B Corp certification in 2019, now operates 14 coffee shops in Uganda, one in Kenya and one in Aurora, Illinois. It plans to open its own roastery in Uganda this year.
Kween-based Masha Coffee buys coffee cherries from a network of nearly 1,000 female-led farms –ranging in elevation from 1,800 to 2,400 meters above sea level – in the Kween, Kapchorwa and Bukwo districts. Masha sends field officers to train local farmers in best practices multiple times throughout the year. Trainers offer guidance on agronomy methods from planting seedlings to soil management to harvesting, etc, and said technical manager, Eunice Chekaptui, “how to be environmentally friendly,” – all to ensure a consistent supply, which benefits both Masha Coffee and the farmers. Masha Coffee also hires local youths to assist with production and processing in Kween.
Endiro Coffee’s shop in Sipi Falls at Lacam Lodge
Masha Coffee has begun shipping roasted coffee to wholesale customers internationally and is exploring distribution opportunities in other countries, including the United States. The coffees Masha processes in Kween are carried in parchment to facilities in Mbale for hulling, and then to Kampala for roasting and packaging. Having to haul the coffee to so many different facilities and towns is costing Masha “time, money and security,” said Achebet, noting her dream would be “to have everything done here.” She said that having everything done in one place would reduce risks. First up would be purchasing a huller, with roasting being the final phase of the plan.
Joining forces to meet demand
Along with 16 other Uganda companies, Masha Coffee is a member of the Coffee Investment Consortium of Uganda (CICU), a Ugandan trade group that shares resources and connections to meet international demand.
By collaborating to deliver higher volumes of higher quality Uganda coffee on the global market, the CICU’s mission is to attract investments specifically to cover expenses and the cost of exporting. Nelson Tugume, CEO of Inspire Africa and chairman of the CICU, said there is no export financing, no available or product-oriented credit. “Coffee is different from other commodities like bananas, from a manufacturing and housing [perspective], therefore you need a particular [type] of financing.”
PACEID is consulting with financial groups and institutions, including lenders, equity funds, foundations and the Uganda Bankers’ Association to develop an export credit fund that will provide affordable financing for producers of coffee and other products. And while many are hopeful such a fund will be established and available soon, the CICU believes time is of the essence. “[International] buyers are saying they want to buy the coffee directly, [but are asking] ‘do you have what it takes?’,” said Tugume. He shared that Uganda needs to create a better environment for investors to bring in the financing. “In terms of production, the farmers can manage it, if you give them a better price. They can manage it at the production level, [but the difficulty] is in the market.”
The UCDA, along with Mountain Harvest Coffee, Endiro Coffee, Masha Coffee and other CICU members firmly believe that as more companies start producing higher quality, Uganda’s profile will be elevated. “The market is going to know Uganda as an origin,” said Barigye, “and it’s going to appreciate Uganda as an origin because we have great coffees.”
Vanessa L Facenda joined T&CTJ in 2012 as editor. She was previously editor of Retail Merchandiser and has written for a variety of magazines including Consumer Reports, Brandweek, Adweek, Hollywood Reporter, and Specialty Food Magazine, among many others. She may be reached at: [email protected].
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Publish date : 2023-11-09 08:00:00
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