• Authored By: Florence Nakazi
28 Aug 2023

Tea is Uganda’s fourth largest agricultural export commodity after coffee, fish, and Maize, earning over $85 million in 2022.  Tea’s contribution to export earnings during the National Development Plan (NDP) III through the agro-industrialisation efforts is expected to increase further as Uganda exploits new markets such as South Sudan.

Yet, Uganda’s tea productivity has stagnated at about 1,600Kg per Hectare, compared to the potential 4,000Kg per Hectare. This could partly explain the observed Uganda’s export volumes of less than 70 million Kgs since 2020.  Uganda’s tea productivity gaps are partly explained by limited use of productivity enhancing inputs like fertilizers even when the cash crop is a nutrient-depleting.

One of the most cited reasons for not using fertilizers among farmers is that they are expensive.  Farmers have limited financial resources and cannot invest in fertilizers, especially before they harvest some tea for sale. This has been worsened by global shocks like the Russia-Ukraine war that led to an increase in the price of a 50-Kg bag of fertilizers from UGX 120,000 to over UGX 200,000.

Government efforts to boost fertilizer use as a means of addressing low productivity through the Agricultural Cluster Development e-voucher input subsidy program have been limited to only few crops: maize, coffee, rice, cassava, and beans. It is evident that government is placing emphasis on productivity enhancement as a pathway to increase agricultural productivity, but tea has not been prioritised, despite being among Uganda’s the top export earning commodity.

Existing private sector efforts through estates have only targeted farmers who supply to them which leaves out the majority – some 67 percent of the tea farmers who contribute to the national volumes.

Other government efforts to increase tea production volumes for export have been through the distribution of tea seedlings through the National Agricultural Advisory Services (NAADS)/Operation Wealth Creation (OWC) input subsidy. It is estimated that approximately UGX 202 billion has been injected in the sector between 2014 and 2022, but not accompanied by supporting inputs like fertilizers.

Tea is also one of the priority crop enterprises for development under the Parish Development Model (PDM) pillar one, on enhancing agricultural production and productivity, to transition the 3.5 million households in the subsistence to the money economy.

For government to fully benefit from the tea seedling distribution programme and the nucleus interventions under the PDM, and eventual increase to export earnings from tea production, government ought to reduce the price of fertilizers and persuade tea farmers to use.

Fertilizer subsidy offers an opportunity to reach remote and underserved smallholder tea farmers who would not have otherwise used fertilizers. By offering targeted and smart subsidies, governments can boost small farmers tea production and incomes. With targeted subsidies, farmers will be able to buy fertilizers at a reduced price, and for those farmers who could not afford fertilizer can get the subsidized fertilizers, which might expand the customer base for private dealers.

Countries like Kenya that introduced 30 percent fertilizer subsidy for its tea have had their annual tea production increase by 67 million Kgs (equivalent to Uganda’s contribution on Mombasa auction market) in 2020. Increasing fertilizer use through the subsidy could play a dual role of improving access and use of fertilizers and improving agricultural production and productivity for increased export volumes.

To harness the sub-sector’s “lowest hanging fruits” that are associated with an exponential increase in production from existing tea acreage, the government should make provisions for the tea fertilizer subsidy. This will help revamp the stagnating tea yields for farmers who contribute 67 percent of Uganda’s tea acreage and 60 percent of total production, and cushion farmers against the high cost for fertilizers.

To be effective and relevant, the fertilizer subsidy should be targeted for tea farmers to get special access, which may be specially formulated to the needs of the tea crop.

Government should leverage on the experience of private sector estates in tea fertilizer subsidies in terms of procurement, targeting, distribution to ably scale it up to smallholder tea farmers. This implies that coordination framework should integrate both public and private stakeholders to avoid delays in procurement and distribution.

Featured picture credit: VOA

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