For ages, the smallholder farmer has been regarded as a small earner. The urban dwellers have always been contented partaking of cheap food supplies while reserving their serious money for ostentatious activities like drinking alcohol, consuming imported supplies and gyrating in discotheques.
Food was taken for granted and the plight of the peasant farmers was only given lip service. Many theorised on how they could be able to earn more and most proposals ended on paper.
The past three years have heralded a new dawn for the smallholder farmers in Uganda. Food prices have increased steadily and caused an outcry among the consumers. This has resulted into a high food inflation.
Food Inflation is in simple terms defined as an increase in the price of food.
Early this year (2022), you could buy A Kilogram of Posho at UGX 1500/=, eight months down the road, that same Kilogram costs UGX 3500/=.
You could buy a Kilogram of Beans at UGX 2000/=, eight months down the road, that same Kilogram costs UGX 4500/=.
Rice on average cost UGX 2,500/= a Kilogram then and today one can hardly get that Kilogram at less than UGX 4,000/=.
All this points to food inflation. The graph below shows the trends of food inflation in Uganda over the past four years and it is clear that the past two years have depicted a very sharp rise.
The consumer is definitely experiencing alot of pain in the process however, what is happening to the farmer? For once the farmer has an opportunity to enjoy decent returns from their food crops. The farm gate price of a number of food crops is equivalent to the urban retail price of the same produce a year ago. This implies that there is more money to be earned by the farmers hence having a positive impact on their livelihoods.
I have grown rice for over three decades but two months back, I registered the highest farm gate price for my produce when a Kilogram was bought at UGX 3600, a price point I used to reach after transporting it over 250Km to the capital city Kampala. What amused me most was the broken rice which also was bought at UGX 2,700, a price much higher than the one of the previous season when rice was averaging UGX 1,400 a Kilo.
The saying, One man’s meat is another man’s poison comes into play here. The poison to the consumers are the high prices while the meat to the farmers is the increasing prices. Could this be signalling a new era that is going to lead to a higher income class of smallholder farmers?
I respond in the affirmative. I cannot deny my happiness seeing the food inflation in place. Year in, year out, I see what the farmers go through and being one too, I have always prayed for the times to change so they start getting adequate reward for their toil. The writing is on the wall, with the ever increasing rural – urban migration, the need to supply food is growing. The opening up of global markets and improving value addition of our food crops is also positioning this country to be a key regional and global supplier of foods. This therefore indirectly extends the demand for the farmers’ produce beyond the national boundaries to markets that can pay even more.
Then the argument comes in, who actually makes the killing when prices rise? Is it the farmers or the middlemen? For every increment in consumer price, a conservative estimate indicates that not more than 30% goes directly to the producer. The rest is swallowed up by the supply chain.
I believe, at this point in time, effort should be put in ensuring the following among smallholder farmers;
- The formation of farmer groups (product specific if possible)
- Training on producing with the consumer in mind
- Financial literacy
- Facilitation of market access
- Value addition
By tackling all or some of these, the incomes of these farmers are likely to extend beyond the current growth. I do foresee the farmer progressively earning more and have improved livelihoods as we head into the future and this is the time for anyone that has ever had interest in farming to join and partake of what is coming.
Farming is finally going to make alot of sense. What are you waiting for?
Agribusiness & Technology Consultant