Rice in Uganda: Viewed from Various Market Channels a Survey Report
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Promotion of Rice Development Project PRiDe Project Rice in Uganda: Viewed from Various Market Channels A Survey Report December 2013 Japan International Cooperation Agency Copy right Ⓒ2013 Japan International Cooperation Agency The views expressed in this report are those of the authors and do not necessarily represent the official positions of JICA. Use and dissemination of this report, with due acknowledgement, is encouraged. It is highly appreciated for those who use some information provided by this report in any publication to send a copy of that publication to JICA at the following e-mail addresses: [email protected] Rice in Uganda: Viewed from Various Market Channels A Survey Report Masao Kikuchi, Kunihiro Tokida, Yusuke Haneishi, Natsuko Miyamoto, Tatsushi Tsuboi and Godfrey Asea Table of contents I. Introduction .......... 2 II. Data Collection and Methodology .......... 5 III. Structure of Rice Consumption .......... 17 IV. Production and Distribution of Rice .......... 46 V. Structure and Workings of Rice Markets .......... 64 VI. International Competitiveness of Rice Production .......... 92 VII. The Rice Mill Industry .......... 109 VIII. Summary and Conclusions .......... 146 References ………. 156 Appendices ………. 162 December 2013 NaCRRI-JICA PRiDe Project 1 Chapter I. Introduction In the history of crop cultivation in Uganda few crops have hardly attracted such a sudden attention as rice has been attracting since around the turn of the century. Rice being not a traditional staple crop in Uganda for consumers as well as for farmers, the production and consumption of rice used to be negligible. At around the time of independence in 1960, rice took only 0.5% of total per-capita calorie intake of Ugandan people and 0.05% of the total area planted by Ugandan farmers to major staple food crops (plantains, cassava, sweet potatoes, millet, sorghum, maize and rice, in descending order), according to the „official‟ statistics as reported to the Food and Agricultural Organization (FAOSTAT 2012). Such a minor crop has attracted abrupt attention of policy makers, researchers and farmers since the early 2000s when a massive campaign commenced to promote the cultivation of New Rice for Africa (NERICA) developed by the Africa Rice Center (then West African Rice Development Association) in many farming areas in Uganda. In 2008 the Government of Uganda prepared the Uganda National Rice Development Strategy (MAAIF 2008), which states that rice production is a key to food security and poverty reduction in Uganda, and joined in the same year the Coalition for African Rice Development (CARD), which aims at doubling rice production in sub-Saharan Africa within 10 years. In 2010 the Regional Rice Research and Training Centre was established at the National Crops Resources Research Institute (NaCRRI) in Uganda with the aim to train farmers, extension agents and researchers and conduct research on appropriate rice technologies in East Africa. A telling testimony of this „rice boom‟ is a sudden proliferation of the literature related to rice in Uganda: Basic rice statistics and innumerable reports and research papers concerning various aspects of rice have appeared since the early 2000s. In particular, the literature that has been mushrooming is on rice production.1 Also burgeoning is the literature on the post-harvest rice marketing processes, or so-called rice value chains, including studies on rice milling which is an important nodal point that determines the quality 1 Balasubramanian et al. (2007) report that rice cultivation in Uganda is practiced under three ecosystems (land types): Rrainfed wet land (roughly equivalent to rainfed lowland; 53% on the average for 1994- 2004), dry land (rainfed upland; 45%) and irrigated wetland (irrigated lowland; 2%). Of these three types, upland rice cultivation has been studied most intensively (Imanywoha et al. 2004; Bigirwa et al. 2005; Wilfred 2006; FIT 2006; Kijima et al. 2006, 2008, 2011; Hyuha et al. 2007; Jude 2009; Fujiie et al. 2010, 2011a; Oonyu 2011; Miyamoto et al. 2012; Bergman-Lodin et al. 2012; Goto et al. 2013; Haneishi et al. 2013a, 2013b, 2013c). In spite of the negligibly small share among the land types, irrigated lowland has attracted increasing attention (Sserunkuuma et al. 2004; Hyuha et al. 2007; Kijima et al. 2010, 2012a; Watanabe 2010; Nakano and Otsuka 2011; Nakano et al. 2011; Fujiie et al. 2011b; Kijima 2012). Contrary to its dominance among the three land types, rainfed lowland rice cultivation has been studied relatively less (PMA Secretariat, 2009; Haneishi et al., 2013b, 2013c). 2 of rice in the market.2 Compared to the production side, studies on the consumption side of rice in Uganda have been nearly totally absent, though there are some studies on food consumption in which rice is included as one of staple foods.3 The rapidly growing literature facilitates greatly our understanding on rice cultivation and production in Uganda. However, the past studies, by nature, tend to focus on well, but narrowly, defined subject areas of the rice economy, and on certain geographically confined parts of the country. For example, studies on rice production are usually based on data obtained from farmers in certain rice production regions of certain rice growing eco- systems.4 Similarly, the past rice marketing studies deal with the rice markets in certain regions or with piecemeal parts of the entire marketing network extending between rice producing regions and consuming areas all over the country. Though none of the past studies is useless, all of them together are still not sufficient to configure a holistic picture of the newly emerging rice sector in Uganda. For configuring the holistic picture, more important than theme-specific individual studies are the national statistics on rice, the provision of which primarily falls in the responsibility of the statistics-related agencies of the government. Indeed, great efforts have been made to generate statistics on rice production systematically: For the first time in the history of the census-level national statistics in Uganda, the area and production of rice were collected in the Agricultural Module of the Uganda National Household Survey 2005/ 2006 as one of the major crops (UBOS 2007), and again in the Uganda Census of Agriculture 2008/2009 (UBOS 2010a, 2010b). These basic national statistics, particularly the latter, are extremely useful in drawing a good picture of the regional as well as national rice production. Such efforts in the systematic data collection being still at a burgeoning stage, however, these statistics are not without problems (Kikuchi et al. 2013a). Regarding rice-market-related statistics, such as the market rice prices and rice production costs, efforts to provide the statistics have also been made by the Bank of Uganda (BOU) and the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF). However, the coverage and extent of the statistics are not at the level usable for analytical purposes.5 It is highly preferable, or a prerequisite, for policy making to have a holistic picture of the rice sector. The purpose of this study is to provide it based on the data obtained a 2 Studies that touch on the rice markets are Wilfred (2006), Yoshida (2008), Emerging Market Group (2008), PMA Secretariat (2009), Fujiie (2009), Oyee (2009), Chemonics International (2010), Gitau (2011), Kijima et al. (2012b). Studies on rice milling include Wilfred (2006), Candia et al. (2008), Kijima et al. (2012b), SMJR Consult (2012). 3 Werema (2007), Benson et al. (2008), Dary et al. (2012). 4 Haneishi et al. (2013b, 2013c) use data collected from a nation-wide rice farmer survey, but cover only rainfed rice farmers. 5 A systematic collection of domestic-market-related statistics is left much to be wanted even in developed countries. 3 series of surveys conducted in the rice marketing channels. The rice markets are the places where all rice, imported from foreign countries as well as produced in the country, goes through, from the farm-gate of rice farmers in the country, and from the country borders through which rice is imported, to consumers outside as well as in Kampala. Therefore, if the rice flows in all the market channels in the country are clutched, the configuration of the country‟s rice sector at large would be drawn in regard of the quantity of rice produced, consumed and traded with foreign countries and their regional distributions. Also made clear are the prices and grades of rice in the markets. The information in these respects helps configure the holistic picture of the rice sector. Under that grand objective, we set the following specific objectives: 1. Estimate regional as well as national rice consumption by grade (quality), 2. Estimate regional as well as national rice production and its distribution among the regions including Kampala, 3. Estimate rice imports to and export from the regions in the country, 4. Estimate the price structure by grade in the rice markets outside as well as in Kampala, 5. Estimate price margins and account for costs incurred in the rice marketing process from the farm-gate all the way through to the retail market in Kampala by market stage, 6. Estimate the international competitiveness of domestic rice, and 7. Observe the rice milling process in the country. 4 Chapter II. Data Collection and Methodology 1. Surveys conducted The main body of data used in this report was collected from a series of surveys conducted from March to September 2012. The major part of the series consisted of four interview surveys: (1) rice trader survey, (2) small grocery store survey, (3) supermarket survey and (4) rice mill survey. In the rice trader survey, we interviewed rice traders who were engaged in the buying and selling of rice either paddy or milled rice at some levels of the rice marketing process from after farm-gate to before final consumers, including brokers (middlemen), wholesalers and vendors, operating in and around public markets6 in Kampala as well as in major cities and towns in the regions outside Kampala.