By Muhoozi Nelson Mandela
In the lush hills of western Uganda, where verdant tea plantations stretch as far as the eye can see, a brewing crisis threatens the livelihood of thousands of small-scale tea farmers.
Onesimus Matsiko, the chairperson of the Uganda Tea Outgrowers Association (UTOA), lamented that with rising input costs, stagnating leaf prices, and a lack of supportive policies from the government, the once-thriving tea industry is facing a daunting future.
This crisis has prompted farmers and industry stakeholders to voice their frustrations and call for urgent interventions.
The farmers said some of their pressing challenges include, price disparity, quality issues, among others.
Dickson Turinawe, a veteran tea farmer, emphasizes the core issue: the quality of Ugandan tea compared to that of neighboring countries.
He argued that the disparity in tea prices is a direct result of degraded quality, which in turn stems from the lack of viable strategies to enhance it.
“As long as there are no viable strategies to raise the required quality of tea, our debate will always border gossip—talking about a problem without a solution,” Turinawe asserts.
Turinawe said that he believes the solution lies in understanding what neighboring countries have done right.
He notes that these countries treat the tea industry as a public good, recognizing its significant multiplier effect on the national economy.
“As long as this is not understood by the government, the tea industry is doomed. No amount of private effort can enforce the creation of an environment that can guarantee sustainable tea quality,” he warned.
Soaring input costs
Richard Katongole, another tea farmer, highlighted the alarming rise in input costs over the past decade.
“The cost of fertilizer, which used to be sh60,000 per bag, has now soared to sh200,000. Herbicides that once cost sh130,000 per 20-liter container now cost sh450,000. Even a pump that used to cost sh60,000 now costs sh120,000,” he explained.
The escalating costs of diesel, essential for running farming machinery, have also exacerbated the situation according to Katongole.
“A liter of diesel used to cost sh3,500; now it costs sh5,000,” Katongole said.
Despite these rising costs, he said the factory price for a kilo of tea leaf has plummeted from sh600 to less than sh200 over the past decade.
According to him, this drastic decline in prices cannot reward the small-scale tea farmer for their investment and hard work.
Global market challenges
John Karemera, a tea farmer from Mashonga Tea Bushenyi, pointed out a broader issue affecting tea farmers worldwide: oversupply.
“Globally, the supply of tea exceeds the demand, even in countries with good quality tea,” he observed.
“This oversupply has led to depressed prices, making it even more challenging for Ugandan farmers to compete in the global market,” he added.
John Nuwagira, another farmer, noted that despite these challenges, tea has been a lifeline for families in Buhweju and Tooro for over six decades.
“What is bad about tea?” he asked rhetorically, emphasizing the crop’s historical importance in supporting rural livelihoods.
The Rwanda model
Matsiko offered a comparative analysis, highlighting Rwanda’s success in the tea industry.
“Rwanda tea fetches over $3 per kilo of made tea, translating to over sh10,000. Considering it takes 4 kilos of green leaf to produce 1 kilo of made tea, this means a price of sh2,500 per kilo of green leaf,” he explained.
Matsiko suggested that if Ugandan processors and farmers worked together on quality control, a sustainable price of sh800 per kilo could be achieved.
The cost of quality
Katongole reiterated the importance of improving the quality of green leaf supplied to factories but asked who should bear the cost.
“How can we in the tea industry achieve or organize a stakeholders’ collaboration?” he asked, emphasizing the need for cooperation among various players in the value chain, including the government, factory management, farmers, and transporters.
The government, Katongole argued, should establish enforceable standards and policies, while factory management must ensure the quality of received leaf is maintained and processed effectively.
Farmers, on the other hand, he said, need access to affordable inputs like fertilizers, herbicides, and quality pumps, as well as well-paid pluckers to maintain the recommended two leaves and a bud.
Government interventions
With current input costs, the cost of producing a kilo of quality green leaf is around sh1,200. Katongole suggested that with a 50% government subsidy on fertilizers and herbicides, this cost could be reduced to sh600 per kilo.
He also highlighted the importance of efficient transport, noting that fuel and spare parts costs have risen over the years, making it difficult for transporters to recover their investments.
“Local and central governments must ensure adequate budgets for maintaining rural roads, vital for transporting tea leaf to factories,” he noted.
Katongole estimates that an investment of sh180 billion over three years is needed to improve tea quality and fetch an average price of $2.5 per kilo on the world market.
“This investment, he said, would cover costs for fertilizers, herbicides, policy reformulation and enforcement, fuel for local governments, and revamping tea factories owned by farmers.”
The way forward
Katongole envisions that once the quality is improved through sustained government funding, factories could eventually sell tea at $2.5 per kilo, equivalent to sh8,750.
This, according to him, would enable farmers to receive a guaranteed price of sh2,500 per kilo of green leaf, ensuring their investments are adequately rewarded.
He said the tea farmers’ plight underscores the urgent need for coordinated efforts among all stakeholders to revitalize Uganda’s tea industry.
Additionally, as Turinawe succinctly puts it, “No amount of private effort can enforce the creation of an environment that can guarantee sustainable tea quality.”
Only through deliberate government interventions, enforceable policies, and collaborative efforts, farmers said, can Uganda’s tea industry hope to overcome its current challenges and thrive once again.
