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Uganda’s Coffee Production Flat in 2021-2022: USDA Attaché

By: Diana Delgado, Contractor

Uganda’s Coffee Production Flat in 2021-2022: USDA Attaché

Coffee Network (Bogota)-The US Department of Agriculture expects that Uganda’s coffee production will hold steady in the coffee year 2021/22 to around 6 million bags of 60-kg as farmers take old trees out of production via stumping.

Production.

Nairobi forecasts MY 2021/22 combined Robusta and Arabica production will decline slightly by 50,000 bags as old Robusta trees are taken out of production for stumping, a pruning process that removes trees from production for two to three years while rejuvenating the tree production in the long term. 2021/22 Arabica production is forecast to increase by 25,000 bags to 950,000 bags due to cyclical variations in arabica yields. Arabica trees undergo annual yield changes, usually increasing two consecutive years and falling the third.

In 2020-2021, Uganda’s production is around 6 million bags (up 525,000 bags from MY 2019/20) largely due to new Robusta trees maturing.

Uganda’s coffee production is on an upward trajectory due to investments under the Government of Uganda-supported Coffee Roadmap program which launched in 2017. The program supports coffee production through the introduction of new coffee varieties, increasing use of inputs, distribution of seedlings, and improved extension services. Under the program, Uganda aims to increase coffee production to 20 million bags and triple the incomes of farmers by 2030. Uganda predominantly grows Robusta (roughly estimated at 85%), and Arabica is the remainder. Robusta is grown at lower altitudes ranging from 900 to 1,500 meters above sea level, while Arabica is grown in higher altitudes.

Exports

The US Agricultural Department sees exports declining slightly to 5.8 million from 5.9 million bags in the coffee year 2021-2022.

Nairobi estimates 2020/21 exports will increase 10% year-on-year to 5.9 million bags due to record production levels. The bulk of Uganda’s coffee exports are to the European Union with the rest largely going to the United States, Morocco, India, Russia, and Serbia.

Within East Africa, Sudan is the largest export destination for Uganda coffee with MY 2019/20 exports reaching more than 1 million bags according to data from the UCDA.

Stocks

Uganda’s ending coffee stocks will remain steady in MY 2021/22, slightly under a one month-export supply. Uganda harvests coffee throughout the year, removing the need for high stocks to cover export demand. Stocks are held by traders and farmer organizations. The GOU does not run any coffee stocking programs.

Marketing

Uganda has one of the most liberalized coffee sectors in East Africa. Private traders purchase coffee from either producer organizations or directly from farmers for onward processing and export. The sector has attracted significant private sector investment and most international coffee trading companies are locally represented. The 2020 National Coffee Act mandates the Uganda Coffee Development Authority (UCDA) to establish its first coffee auction, introducing a new marketing channel.

Consumption

Domestic consumption MY 2021/22 consumption is forecast to slightly increase to 125,000 bags of 60-kg  due to a possible recovery of the tourism sector as vaccinated international tourists begin to return to Uganda. Consumption by local Ugandans is likely to continue to remain depressed due to poor COVID conditions.  In the coffee year 2020/21 consumption is estimated to remain low at 100 thousand bags, less than half Uganda’s pre-COVID consumption.

 The Government of Uganda enacted stringent lockdown measures after the onset of the pandemic in early 2020. These measures restricted coffee consumption which is concentrated mainly in urban areas and tourist facilities.

Policies

 UCDA continues to implement the National Coffee Policy. The policy provides guidance on coffee market diversification and promotion of sustainable production systems, value addition, and domestic consumption. The policy also guides improvement of Uganda’s capacity in coffee research and development. Uganda has several other guidelines and policies that cover various aspects of the coffee industry including production, processing, and trade. These guidelines are available at the following link: Uganda Coffee Sector Policies. UCDA charges a levy of two percent on all coffee exported based on its contract price. In 2020, Uganda enacted the National Coffee Act which streamlines the regulatory role of UCDA and promotes accountability at every stage of the coffee value chain. The National Coffee Act contains a new requirement for coffee growers to regularly update their production statistics with UCDA to improve market information.

 

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