THE ROLE OF COOPERATIVES IN LINKING SMALL SCALE FARMERS TO LOCAL AND REGIONAL MARKETS OF STAPLE FOODS IN UGANDA

1. THE ROLE OF COOPERATIVES IN LINKING SMALL SCALE FARMERS TO LOCAL AND REGIONAL MARKETS OF STAPLE FOODS IN UGANDA By Tayebwa Bernard Manager, Agribusiness Unit, UCA

2. About UCA

3. About UCA • UCA is an umbrella organization of co-operatives in Uganda • Registered in 1961 • Currently UCA is independent member-based coop. under MTTI • In addition to other development work, UCA is mandated to do advocacy and lobbying for the cooperative movement.

4. EMPOWERING (NOT HELPING) SMALL SCALE FARMERS THE ONLY WAY TO EMPOWER FARMERS IS THROUGH FACILITATING THEM TO STRENGTHENING THEIR ORGANISATIONS SO THAT THEY TAKE AN UPPER HAND IN SOLVING THEIR PROBLEMS-(Produce, process, sell/export..) COOPS ARE THE BEST WAY TO DO THIS .

5. Structure of coops before liberalisation • Primary - district Union - Apex(UCA) • Relied on marketing boards for marketing, crop finance… • Unions far from primaries-farmers had no control. • Exploited farmers-buy at low prices ,sell at profit and not pass the profit to the farmer-invested in assets...

6. After liberalization • Govt pull out of mkting boards.Passed 1991 law making coops autonomous • District Coop unions could not adjust from dependence on govt-almost all collapsed. • UCA reforms-Area Coop. enterprise at sub-county level, ACEs brokers not buyers.. • Started SACCOS;diversification; empasised self-help. • Came up with the integrated model

7. Members Primary Society (RPO) ACE Shares plus ideas Shares plus ideas Farmers’ Advisory Services, Marketing Services Marketing Services Value Addition Savings facility, loans + other financial services Shares savings + ideas Financial Services Financial Services Shares savings + ideas Shares savings + ideas S A C C O The Integrated coop.Model

8. The Integrated Coop. Model • Our farmers are organised into primary societies(rural producer organisations) ,Secondary coops(Area coop.enterprises) and regional/national unions. • At every ACE level there is a SACCO for providing financial services to members.

9. National Unions • Have been formed (recently)along commodities like grains, honey, wines and juices, fish, beef , livestock, crafts and furniture, herbalists • ACEs are members of national unions • SACCOs have formed Uganda Central Coop Financial Services(UCCFS) as a SACCO of SACCOs and other coops for intermediation. • National coops for lobbying, advocacy, link ACEs to bigger input and commodity markets.

10. Role of RPOs • Mobilise members to pay share capital and to participate in devel activities • Access and guide on use of inputs(study Circles) • Selection of enterprises(3) and varieties • Access to extension and other educ • Organise commodities for transporting to ACEs • Organise to transport commodities to ACEs

11. Fish enterp. becoming popular

12. Role of ACEs • Bulking-as a broker not buying;genuine weighing • Storage-on pallets,fumigation,safety,coolers(for milk),labbling/branding • Value addition • Look for markets-esp. contracts • Market information to members • Facilitate warehouse Receipt system operations-store until prices are good but farmers get about 50% from SACCOs or banks thru UCE) as they wait. • Bulk purchase of inputs –shops, arrangements • Share of indivisible inputs like tractors • Look for partners to complete value chains • Address gender, environm,AIDS/HIV

13. Links of ACEs with UCE • ACEs access UCE stores easily-now in jinja,Tororo,Masindi,Mbarara,Kasese,Gulu • Several banks give loans against UCE receipts Solution to crop finance problem • Easy to link to external markets thru UCE • So WRS can be at the ACE/SACCO or bank/UCE levels

14. Value addition convenient in ACEs • Joint bar codes and certification with NBS • Joint patent rights • bulking. Some cottages have over 10,000 litres of banana/pinneaple wine • Bulk procurement of inputs eg; bottles • Easy training-can even hire trainers jointly • Can share machines like destoners,rice hullers, maize hullers,g.nut shellers,milk coolers

15. Value addition in cottage industries(honey, wines)

16. Role of ACEs-bulking

17. Role of SACCOs

18. Role of SACCOs • Encourage rural savings which are channeled to investments -Job and wealth creation • SACCOs employ many people • Training leaders and members esp in profitable opportunities. • Mobilize resources for investment e.g from lead banks and MSC • Increase liquidity esp. in rural areas. • Several products eg.Agric loans, water,insurance,moneytransfers,solar,salary a/cs and loans

19. Strength of SACCOs

20. Role of SACCOs contd • Facilitate Marketing through warehouse receipt system-accepting receipts from Marketing cooperatives as security for loans. • Are entry points of different programs • Have special products for education, insurance(esp.on loans), shelter, agriculture

21. Major challenges of coops • Ltd funds to extend the integrated model to the whole country. • Inadequate storage at RPO and ACE levels. • Inadequate funds for Warehouse receipt System at SACCO level • Shortage of infrastructure and facilities for value addition

22. Major challenges of coops • Bad history of coop. collapse • No regulatory law/authority for SACCOs • Many players in SACCO business-not all under UCA • Shortage of leaders-change after second term

23. Maize stored in the open in Masindi

24. Major interventions needed • Facilitation to UCA to extend the integrated model to the whole country (now only 80 ACEs)and to other countries. • Capacity building of co ops-enable them be at the fore front • Storage at Primary and secondary level-owned and run by farmers. • Support SACCOs to facilitate warehouse receipt system • Funding for value addition infrastructure and facilities • Cooperation among coops within countries and across boarders • Contd support to comm.exchange; Linking commodity exchange markets in Africa.