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Analysing milk price incentives to strengthen policies for dairy production and exports in Uganda

Technical note









Nkuingoua Nana, J.C., Pernechele, V., Meilland, T., Munyuka Ariong, R. & Otikal, K. 2022. Analysing milk price incentives to strengthen policies for dairy production and exports in Uganda Technical note. Monitoring and Analysing Food and Agriculture Policies (MAFAP). Rome, FAO.



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    Analysing beef price incentives to strengthen policies for production and exports in Uganda
    Technical note
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    In Uganda, 58 percent of households depend on livestock for their livelihoods, with cattle being the most important livestock subsector in the country. Despite natural pastures, water resources, and big demand in national and world markets, beef production in Uganda grew by only 1 percent in the last decade, and lags behind local demand. In the last decade, the government has adopted several policies within the framework of the National Development Plan, aimed at increasing domestic beef production and exports. This report assesses the effects of policy support on the beef sector in Uganda over the last four years (2017–2020), and also includes previous analysis on live cattle for the period 2005–2016. To measure price incentives, the study relies on renowned indicators; the nominal rate of protection, nominal rate of assistance and the market development gap. The results reveal that in the past (2011–2016) breeders were penalized by low prices, while recently they benefitted from prices above the international-equivalent, mainly due to restrictions on cattle movement due to a foot-and-mouth disease (FMD) outbreak, which increased domestic prices. The persistent gaps between domestic and international prices can also be explained by the very limited price transmission and weak market integration of the beef value chain in Uganda. FMD is a critical issue to tackle to improve beef commercialization and competitiveness, together with the significant value chain inefficiencies, such as high transport costs and the presence of informal fees, that still hinder marketing and profitability of this sector.
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    Response to Containment of Tick Resistance and Tick-Borne Diseases in Uganda - TCP/UGA/3702 2020
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    Agriculture is an extremely important sector in Uganda, employing 66 percent of the labour force and accounting for 53 percent of the country’s exports. Women make up the majority of agriculture workers, at 77 percent. The sector is a key contributor to poverty reduction, and it provides food and nutrition security, as well as raw materials for variousindustries. The sector also accounts for more than 24 percent of Uganda’s national Gross Domestic Product (GDP), and nine percent of this total is attributed to a single subsector: livestock. Roughly 2.2 million households work in livestock production, on smallholder dairy farms, and in crop-livestock and livestock-dependent systems. The subsector provides crucial employment opportunities and food to the Ugandan population. For these reasons, it was named as one of the priority development areas of the Government of Uganda, as indicated in the 2015 – 2020 Agricultural Sector Strategic Plan (ASSP). Despite its importance to the economy and food security of the country, the livestock subsector suffers from low rates of productivity, owing in large part to pests and the diseases they carry. Major annual losses of approximately USD 86.3 million are reported, with 70 percent of these losses being caused mainly by ticks and tick-borne diseases (TBDs). The control of ticks and TBDs causes further economic strain, as it makes up more than 60 percent of spending among farms and businesses that raise and keep cattle. Some of these economic losses come about because of the damage that tick bites can cause to the hides and skins of cattle. If enough ticks prey on an animal by feeding on its blood, that animal can also lose weight and become anemic. The most significant losses, however, are brought about by the transmission of diseases to livestock. Ticks carry protozoan and rickettsial diseases, as well as viruses. It is estimated that they impact about 80 percent of the world’s cattle population. These diseases have a detrimental impact on the livelihoods and nutrition of poor farmers and rural people all over the world.
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    Inland small-pelagic fisheries utilization options, marketing and opportunities for support 2012
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    The fisheries sector contributes greatly to the economies of the eastern, central and southern regions of Africa (ECSA) in terms of income, employment and export revenue. Until recently, only large-sized fish were exploited for human consumption but small-sized pelagic fish were used for animal feed production. However, in the last decade, concerted efforts have been made in various African countries to reverse the trend. For example in 2005, an FAO led study assessed post-harvest losses in one of the abundant small-sized pelagic fisheries (Rastrineobola argentea), in the East Africa states of Kenya, Uganda and Tanzania. In 2011, Uganda through the Department of Fisheries Resources (DFR), requested FAO under the Technical Corporation Programme (TCP) to address the question of high post-harvest losses in the fishery and improvement of upstream handling against a backdrop of declining per capita consumption trends. Under this programme, several products were developed to increase Rastrin eobola argentea, locally called Mukene, for human consumption. The SMARTFISH Programme, with funding from the European Union (EU) built on previous efforts by initiation of the present study that has been designed to look at increased utilization options to enhance cross-border trade in small pelagics. As a test case, products from Brycinus nurse (Ragoge) and Neobola bredoi (Musiri) commonly found in Lake Albert of Uganda were developed together with potential Ugandan processors and the economic ally viable products were marketed in neighbouring Kenya and Rwanda to gauge their marketability. Using a structured questionnaire with some input from the Trade Event Specialist, some potential regional traders tasked to evaluate their prospects. Prior to product development, information was gathered on all aspects of the Musiri and Ragoge fishery, including the sanitary status of fishing vessels, time of capture, daily catches, drying surfaces, storage facilities, packaging, wholesale operatio ns as well as markets and transportation. The sand-free sundried products, powdered and fried products were promoted for regional markets. As a complementary study, the nutrient content of products from both fish species was determined for purposes of backstopping the three up-graded processors who were at different levels of development. The regional market opportunities surveyed indicated that there was an insatiable demand for all products made from small-sized pelagics ranging from sun-dried to powdered. The large quantities demanded by the regional markets could not be met by processors using traditional processing methods and operating at a small-scale. It was also evident that product quality was a determinant factor in product pricing. The cost of sand-free products was one and a half times more than adulterated products which underscore the influence of consumers in the market place. There were other external drivers that are likely to enhance regional trade of the identified value-added products from Uganda. They included population increases, regional geo-economic and political blocks, carbohydrate-based diets, nutritional properties of fish and civil strife or wars. During the implementation of the present study, there were two major challenges namely; seasonality of the two species under scrutiny and the competence of local processors to be up-graded to standards required by the regional as well as international markets. Both factors slowed down the implementatio n process because unplanned exposure visits and training had to be conducted to improve the competence of potential processors under the up-grading SMARTFISH scheme. In conclusion, there was an insatiable demand in the region for all products made from small-sized pelagic fishes from Uganda and trade in such products can be enhanced in the region with concerted effort from all key actors along the value-chain, improved upstream handling, broadened utilization base, consumption campaigns and enfo rcement of quality and safety standards. However, implementation of some intervention measures cited would require harmonized policies across national borders, substantial investment in the sector, sensitization of key actors with regard to market requirements and goodwill among policy enforcers at border crossings.

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