Uganda - Country Commercial Guide
Agricultural Sector

This is a best prospect industry sector for this country.  Includes a market overview and trade data.

Last published date: 2021-11-12

Overview

Investors consider Uganda’s agricultural potential to be among the best in Africa, with low temperature variability, fertile soils, and two rainy seasons over much of the country - leading to multiple crop harvests per year.  According to the UN’s Food and Agriculture Organization, Uganda’s fertile agricultural land has the potential to feed 200 million people.  Eighty percent of Uganda’s land is arable but only 35% is being cultivated.  In fiscal year 2020/2021, agriculture accounted for about 23.7% of GDP, and 31% of export earnings.  The UBOS estimates that about 70% of Uganda’s working population is employed in agriculture.  Uganda produces a wide range of agricultural products including: coffee, tea, sugar, livestock, fish, edible oils, cotton, tobacco, plantains, corn, beans, cassava, sweet potatoes, cassava, millet, sorghum, and groundnuts.  Commercialization of the sector is impeded by farmers’ limited use of fertilizer and quality seeds, and a lack of irrigation infrastructure – rendering production vulnerable to climatic extremes  and pest infestations.  Sector growth is also impaired by the lack of quality packaging capabilities, insufficient storage facilities, poor post-harvest handling practices, shortage of agricultural credit, high freight costs, the lack of all-weather feeder roads in rural areas, a complicated and inefficient land tenure system, and limited knowledge of modern production practices.  Ugandan producers often find it difficult to meet sanitary and phytosanitary standards required to export goods to Europe and the United States.  In March 2021, Kenya banned the importation of maize from Uganda, noting that it contained high levels of aflatoxins.  After the ban, only grain exports tested and certified by accredited labs in Uganda to meet acceptable safety levels are permitted into Kenya.     

Opportunities

There are significant investment opportunities in Uganda’s agriculture sector, including in production, input supply, value addition processing, standards compliance and export, and post-harvest handling.  In the coffee sector, there is space to increase coffee production and the amount of coffee exported to the United States.  Uganda is Africa’s leading coffee exporter, but sends just 5.7% of its exports to the United States.  The Uganda Coffee Development Authority reported that Uganda’s coffee exports for the month of June 2021 were the highest ever in a single month since 1991 (619,388 60-kilo bags valued at $58.56 million).  The government has developed an ambitious, yet detailed, plan to increase its current production of 402,000 tons of coffee to 1.2 million tons annually by 2025.

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