Chal­lenges fac­ing the cot­ton sub-sec­tor

By: Parliament Reporter

Cot­ton was in­tro­duced in Uganda by the British Cot­ton Grow­ers’ As­so­ci­a­tion in 1903 by the British Colo­nial­ists as the first cash crop. Pro­duc­tion was car­ried out in Uganda by small scale farm­ers, and gin­ning was done in Kenya and the lint was then ex­ported to Liv­er­pool to ser­vice the British Tex­tile Mills. From 1903 to 1930, it was purely grown as a Gov­ern­ment crop whereby each fam­ily had to manda­to­rily have at least 0.5 Ha as a way of gen­er­at­ing house­hold in­comes. In the 1920s, Cof­fee was in­tro­duced, fol­lowed by Tea and To­bacco. Even­tu­ally, cof­fee over­took cot­ton in the 1930s as the coun­try’s ma­jor for­eign ex­change earner and cot­ton took sec­ond place.

The sec­tor was mainly dom­i­nated by the In­di­ans who es­tab­lished gin­ner­ies across the coun­try and took over Pro­cess­ing and Mar­ket­ing while Gov­ern­ment re­tained the Re­search, Seed Breed­ing, Ex­ten­sion Ser­vices, In­put Sup­ply and Qual­ity Con­trol func­tions. In ad­di­tion, Gov­ern­ment es­tab­lished 3 tex­tile mills and 1 spin­ning mill to add value to lint and to ab­sorb the in­creas­ing pro­duc­tion.

This re­sulted to in­creased pro­duc­tion to 371,000 bales by 1960/​61. How­ever, the pop­u­la­tion re­volted against the pri­vate sec­tor due to ex­ploita­tion and farmer co-op­er­a­tives emerged around 1962.Gov­ern­ment com­pen­sated the In­di­ans, took over own­er­ship of the gin­ner­ies to­tal­ing about 50 and handed them over to the Co-op­er­a­tive Unions
It also es­tab­lished a Lint Mar­ket­ing Board (LMB) with mo­nop­oly to trade in all the lint and cot­ton seed. It also re­tained all the other func­tions men­tioned above. As a re­sult, pro­duc­tion shot up reach­ing the high­est level ever pro­duced in Uganda of 470,000 bales of lint in 1969/​70.

How­ever, the 1970- 1980 po­lit­i­cal tur­moil that be­fell the coun­try did not spare the crop. Ac­tiv­i­ties of cot­ton pro­duc­tion were se­verely af­fected. Con­se­quently, pro­duc­tion fell rad­i­cally reach­ing the low­est level of 11,000 bales in 1987/​88. Uganda Cot­ton ceased to be traded by grade on the In­ter­na­tional mar­ket and was in­stead traded by source gin­nery of the lint.

In 1994, Cot­ton mar­ket­ing and pro­cess­ing were lib­er­al­ized and the Cot­ton De­vel­op­ment Or­ga­ni­za­tion (CDO) was es­tab­lished as a Gov­ern­ment body to pro­mote cot­ton pro­duc­tion, mon­i­tor pro­duc­tion, pro­cess­ing and mar­ket­ing, reg­u­late the Cot­ton Sub­sec­tor. In this year, the mar­ket­ing sea­son opened of­fi­cially on 30th Oc­to­ber, 2015 and to-date 3,906,756 kg of seed cot­ton (equiv­a­lent to 8,818 bales of lint) sup­plied to gin­ners. But due to the loss of ground by the tex­tile in­dus­try to the com­pe­ti­tion com­ing from the Far East and to sec­ond hand cloth­ing, only around 5 % of the to­tal cot­ton pro­duc­tion is con­sumed by two lo­cal tex­tile fac­to­ries. These are Fine Spin­ners and Nyanza Tex­tile In­dus­try.

While ap­pear­ing be­fore the Par­lia­ment Com­mit­tee on Bud­get on 24th No­vem­ber, 2015 to de­fend the Ugx 10bn sup­ple­men­tary ex­pen­di­ture ad­vanced to CDO for the pur­chase of 2,000 met­ric tones of cot­ton buffer stock in FY2014/​15. Mrs. Jolly Sabune, the Man­ag­ing Di­rec­tor of CDO high­lighted the var­i­ous achieve­ments that has been reg­is­tered in the sec­tor. These ranges from the es­tab­lish­ment of 1820 acre of cot­ton grow­ing in 20 dis­tricts by prison farms and army units, im­proved yields by farm­ers of 1,000- 1,500 kg per acre among oth­ers.

How­ever, she also pointed out some chal­lenges fac­ing the sec­tor which in­cludes; the con­tin­ued de­pen­dence on cli­matic sea­sons, per­sis­tence in­ci­dences of new pest, de­clin­ing soil fer­til­ity, high cost of pro­duc­tion in­puts most of which are im­ported, lack of co­he­sion among farm­ers and low lev­els of do­mes­tic value ad­di­tion to lint which per­pet­u­ates de­pen­dence on in­ter­na­tion­ally de­ter­mined lint process since over 95% of lo­cally pro­duced lint is ex­ported as a raw ma­te­r­ial.

She fur­ther ar­tic­u­lated that the above chal­lenges are be­ing ad­dressed by the Reg­u­la­tion Body through adopt­ing syn­er­gies with cot­ton sub-sec­tor stake hold­ers. For ex­am­ple, the Tech­ni­cal As­sis­tance Pro­gram be­ing im­ple­mented by the Gov­ern­ment of In­dia with the aim if strength­en­ing com­pet­i­tive­ness of the cot­ton sec­tor in Africa; Cot­ton Pro­duc­tion Sup­port Pro­gram both CDO and Uganda Gin­ners and Cot­ton Ex­porters’ As­so­ci­a­tion (UGCEA) are pro­mot­ing the use of yield and qual­ity en­hanc­ing in­puts in cot­ton pro­duc­tion.

CDO has also part­nered with Na­tional Semi-arid Re­sources Re­search In­sti­tute in Serere Dis­trict to im­prove gen­er­a­tion and re­lease of new cot­ton va­ri­eties that meet the re­quired terms of drought, pest and dis­ease tol­er­ance, high yields and bet­ter lint char­ac­ter­is­tics. The reg­u­la­tor has also col­lab­o­rated with the Uganda Pris­ons and some army units to un­der­take com­mer­cial cot­ton pro­duc­tion and with gin­ners and lo­cal tex­tile millers to im­ple­ment the Re­volv­ing Lint Buffer Stock Fund for pro­vi­sion of raw ma­te­r­ial (lint) to the tex­tile.

How­ever, the above in­ter­ven­tions are still min­i­mal, in the cur­rent FY2015/​16 the sec­tor was al­lo­cated only Ugx 5.30bn, it is high time for par­lia­ment to urge gov­ern­ment to in­crease pub­lic fund­ing to the cot­ton sec­tor to en­able farm­ers add value, ac­quire the req­ui­site in­puts; or­ga­nize farm­ers to form strong and cred­i­ble groups, pro­vide in­cen­tives like re­duc­ing on the elec­tric­ity tar­iffs which will owe in­vestors to Uganda, en­sure sta­bil­ity in the prices of cot­ton by es­tab­lish­ing a cot­ton buffer stock fund.

With China ex­pe­ri­enc­ing high costs of pro­duc­tion in the tex­tile in­dus­try de­spite the rise of Asian cot­ton block, Africa re­mains the most suit­able con­ti­nent to be­come the next cot­ton pro­duc­tion for the world due to it fa­vor­able cli­mate. Uganda has a com­par­a­tive ad­van­tage in the re­gion ow­ing to the good qual­ity of cot­ton pro­duced and the avail­able man­power. Coun­tries like Ethiopia have al­ready tapped into the in tex­tile in­dus­try by pro­vid­ing in­cen­tives like elec­tric­ity. This pro­moted Kenya to in­vest over US$40m in the cot­ton sec­tor to in­crease its pro­duc­tion.

Cot­ton is one of the most strate­gic crop for re­solv­ing a num­ber of multi-sec­toral chal­lenges af­fect­ing the county. It is ca­pa­ble of in­creas­ing house­hold in­comes and poverty al­le­vi­a­tion. Gov­ern­ment and Par­lia­ment should sup­port the sec­tor to­wards es­tab­lish­ing large scale com­mer­cial pro­duc­tion; in­crease in do­mes­tic value ad­di­tion to lint. This will cre­ate em­ploy­ment op­por­tu­ni­ties for the youths, gen­er­ate rev­enue and con­tribute to the sta­bi­liza­tion of the coun­try’s Bal­ance of Pay­ment.