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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 . About UCA. About UCA. UCA is an umbrella organization of co-operatives in Uganda Registered in 1961

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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

about uca3
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.
empowering not helping small scale farmers
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 .

structure of coops before liberalisation
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...
after liberalization
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
the integrated coop model

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
the integrated coop model8
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.
national unions
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.
role of rpos
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
role of aces
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
links of aces with uce
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
value addition convenient in aces
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
role of saccos18
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
role of saccos contd
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
major challenges of coops
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
major challenges of coops22
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
major interventions needed
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.