Hill et al MIFIRA Uganda Draft Report 2011.doc

Uganda it is among the top five commodities exported

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Uganda, it is among the top five commodities exported in the intra-regional market of the East African Community (EAC 2008). Because maize is also an important source of income, the performance of grain markets has a significant impact on people’s welfare, particularly that of the poor in East Africa. Given growing urbanization and the high rates of poverty that limit dietary upgrading, East Africa’s market demand for food staples is predicted to grow dramatically in coming decades, from US$6.9 billion in 1997/99, to US$11.2 billion in 2015 and to US$16.7 billion in 2030 (Riddell et al., 2006). As a result, production of maize and other food staples for growing urban markets and deficit rural areas (often also across borders) would seem to represent the largest growth opportunity available to farmers in the region. The welfare benefits of linking food surplus zones with food deficit zones both within and between countries in Sub-Saharan Africa are well- documented in recent analytical work (Haggblade et al. 2008; Diao et al. 2008). Cross border trade with neighboring countries, mainly Kenya, the DRC and Rwanda, accounts for significant amounts of maize leaving Uganda. Uganda is an important provider of food to its neighbors, while exporting very little beyond into global markets. By quantity, maize exports ranged from 14%-29% of total food exports from the period 2004-2008 (UBOS 2009). For over a decade, Uganda has been exporting maize mainly to Kenya both through formal and informal cross border trade. The Kenyan market, which accounts for about 50% of total exports, is the most significant export market for Uganda’s maize, although this market is occasionally Page 6
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hampered by unfair trading practices (Rashid 2004). Kenya imports an average of 55,000 MT of maize, valued at US $3 million, from Uganda through the official channels, but the informal channel is thought by many to be dealing with larger amounts (even by value) of maize (Technoserve 1999). Uganda’s food markets are clearly of importance not only for its own food security but for that of the surrounding region. c. Local and Regional Procurement in Uganda With an annual per capita consumption of only about 30 kg (owing to plantains being the main staple in Uganda), the consumption of maize in Uganda is less than one half of the corresponding figures in Kenya and Tanzania (Haggblade 2010). Though maize plays a relatively moderate role in consumer diets in Uganda, increasing purchases by WFP (and other donor agencies) have encouraged a supply response from farmers in producing more maize and from traders in establishing facilities in Kampala to supply the WFP (Sserunkuuma and Associates 2005). WFP started procurement in Uganda in 2000, and from 2004 reports that between 79,000 and 160,000 MT have been available for sale to WFP and for export. The primary commodities procured by WFP in Uganda are maize and beans, with 79,083 MT and 15,110 MT procured in 2008, respectively (WFP 2009a). WFP is the single largest food purchasing organization in Uganda; in 2009 the value of its total procurement reached $50 million (WFP2009b), and it is set to triple in 2010. 1
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