National Oil Palm Project – Prime Time Communications

Out to Lunch

#OutToLunch High soap prices call for a shift to oil palm growing

#OutToLunch High soap prices call for a shift to oil palm growing By Denis Jjuuko Scarcity is the mother of ingenuity; we have always been told. When things are scarce, human being quickly learn and adopt alternatives. For many Ugandans who grew up during the 1970s and 1980s, when household commodities were scarce, they learnt to improvise. Certain plants, I am told, were used to wash both the clothes and human body. Soap was one the household commodities that were extremely scarce. Kids in urban middleclass homes learnt what their village counterparts always experienced — tea without sugar or to sugarless tea taken with sweet potatoes and/or sweet bananas. Over the last few days, you have probably seen social media posts of how expensive a “tree” (read bar) of soap is. At the turn of this year, a bar of soap was going for about Shs3500 for the well marketed brands and much less for ‘average’ brands. Today, the same “tree” of soap is threatening to reach the Shs10,000 mark. Unlike the 70s and 80s where goods were not on the market, today, if you have money, you will be able to get whatever number of “trees” of soap that you may need. To be fair, it is not only soap whose prices have gone up. A 50kg-bag of cement is now on average at Shs32,000 from about Shs28,000 in January this year. Steel bars, have gone up by about Shs10,000 for the 16-millimeter size for the new brands on the market. Established brands are now selling by more than Shs20,000 of the January 2022 prices. Of course, today I will not say anything about petrol and diesel to avoid boring you to death. But since the issue now at hand is soap, let me stick to that. The main ingredient for soap is crude palm oil which is largely imported from Malaysia and Indonesia, the world’s leading producers. Palm oil is extracted from oil palm fresh fruit bunches. Growing oil palm was only introduced to Malaysia and Indonesia by British colonialists otherwise it is an indigenous plant of Sub-Saharan Africa. Yet the continent is now almost a net importer of crude palm oil. It tells you how far we have come! Palm oil is the world’s most diverse agricultural product. It can be used to make soap, cosmetics and at the same time edibles like cooking oil. In Uganda, we first experimented growing oil palm in Ssese islands in the 1970s but commercial farming only started in mid-2000s. Figures from the National Oil Palm Project (NOPP) of the Ministry of Agriculture indicate that the country needs to grow at least 100,000 hectares to meet current national demand. In Kalangala, only 11,346 hectares have been planted and another 7,500 hectares are under cultivation or planned in Buvuma. Oil palms take four years to mature and last between 18-25 years after which they have to be cut and replanting starts again. Today, the price of crude palm oil has gone up because of many reasons. First, the invasion of Ukraine and Russia according to Reuters has halted the supply of sun oil, an alternative to palm oil. “Palm oil has become the costliest among the four major edible oils for the first time as buyers rush to secure replacements for sunflower oil shipments from the top exporting Black Sea region that were disrupted by Russia’s invasion of Ukraine,” the Reuters article reads. The article adds that “since ports in Ukraine will remain closed until the invasion ends, Asian and European refiners have raised palm oil purchases for near-month shipments to replace sun oil which has lifted palm oil to irrational price level.” Second, Malaysia has reacted by restricting crude palm oil exports to meet its own national demands first. Third, since last year, Uganda introduced a 10% tax on crude palm oil imports. These factors have increased the price of crude palm oil in Uganda. The beauty of this though is that farmers in Kalangala are laughing all the way to the bank. As you read this, a kilogram of oil palm fresh fruit bunches is going for Shs1,238 compared to last month’s Shs1,137. Since September 2019, prices of oil palm fresh fruit bunches have increased by 166 percent from Shs465.This is good for Ugandan farmers. In Kalangala, there are 2,063 smallholders who make about Shs6 billion collectively every month. An acre of oil palm gives the farmer at least a monthly income of Shs400,000 (oil palms are harvestable every 10 days). If the government is keen to empower farmers, oil palm growing is one of the solutions. Could the parish development model look at areas where farmers can grow this crop and empower them to do so? The writer is a communication and visibility consultant. djjuuko@gmail.com

May 4, 2022

Out to Lunch

#OutToLunch Oil palm expansion will ensure predictable incomes for farmers

By Denis Jjuuko While on a trip from Kalangala sometime back, I met a man who looked every inch in his sixties on the ferry as we crossed Lake Victoria from the island to Masaka. He seemed to have recently dyed his hair dark black. He was wearing an oversize double breast jacket. He had a young man in his company, who was carrying a small backpack he couldn’t put down. I had seen him park a Land Rover Freelander on the ferry. I was fascinated. Although the car had seen a bit of days, I didn’t expect him to be driving such a car in a rural setting where Toyotas rule the roads. So I wanted to know what he did for a living and where he was heading. I was interested in knowing his story. Naturally I started up small talk. It had rained the whole morning and we started with rising water levels. With the ferry engines roaring nonstop and the lake so calm, I asked him what he did for a living — a living that would make him driver a Land Rover Freelander! He told me he was on a business trip to Masaka and may end up in Rakai depending on his prospects. He said he was on a mission to expand his farm. I had mistaken him for a fisherman or somebody involved in the fishing value chain. He told me his father somewhat discouraged him from fishing as a kid saying the lake was dangerous and always left him at home as he went on his fishing excursions. So when he dropped out of school, he concentrated on farming. He said he wanted to look for land in Masaka when it was still affordable. He said he had received information that the government was planning to establish oil palm growing beyond the island of Bugala in Kalangala. “If government goes ahead and starts oil palm growing in Masaka, the land prices will go up,” he said. “That is why I want to go to Rakai as well because government plans to establish oil palm in Sango Bay area,” he informed me. He was involved in oil palm growing in Kalangala where he established a plantation on about 100 acres. “I have given most of the Kalangala farm to my children. I only own about 28 acres now of oil palm trees and another 10 for food,” he said. “I am too old to be buying food,” he joked. I was still enjoying the talk when the ferry captain sounded the horn indicating arrival in Bukakata and end of my talk with this interesting businessman. At the pier in Bukakata, we said goodbye before he told me that if I ever come back to Kalangala I should simply ask any boda man to direct me to his home. “Simply ask them to bring you to Kinazi Kyabala, my home is along the main road,” he said, braggingly. Kinazi Kyabala is Luganda for oil palm is profitable. Given his car and business acumen, he may not have lied. I watched a TV story last week that the private sector players having seen how Kalangala has developed, are not waiting for government to establish nucleus estates for oil palm in Masaka, Rakai and in the Aswa region in northern Uganda. They are establishing the farms themselves. To meet current palm oil demand, Uganda needs to grow 100,000 hectares of oil palm. In Kalanga and Buvuma, the numbers are below 20,000 hectares so far. The price of oil palm fresh fruit bunches in Uganda has grown from approximately Shs200 a kilo in 2010 when the oil palm harvests started to more than Shs900 in July 2021. Data from the National Oil Palm Project indicate that on average, a farmer earns between Shs400,000 to Shs600,000 per acre per a month. Smallholder oil palm growers in Kalangala like the man I met on the ferry who number 2,063 (with about 1300 of them with harvestable crops) earn approximately Shs5 billion every month. This is a huge income for these farmers and no wonder the old man I met on the ferry was driving a Freelander to stand out. From his farm, he could afford it. The government and indeed local leaders should mobilise farmers in the areas where the private sector is acquiring land so that they learn from Kalangala farmers and embrace this crop instead of only selling land to the private sector. Oil palm trees take four years to mature and harvestable every 10 days for about 18 to 25 years before they are replaced. This kind of predictable income is what the majority of our farmers need to get themselves out of poverty. The writer is a communication and visibility consultant. djjuuko@gmail.com

September 3, 2021

Out to Lunch

#OutToLunch Buvuma Island is the next frontier for long term investors

By Denis Jjuuko Traffic is building up as many people mill around the shores of Lake Victoria. A few boats are back to the landing site with the night’s catch. Traders from Kampala and Mukono are haggling for the best fresh fish. Those who are happy to have made a good bargain smile in anticipation of huge profits. A boda boda man is trying to fit a Nile Perch, the size of a teenager, on his motorcycle. It is Kiyindi in Buikwe District. Kiyindi is a landing site on the shores of Lake Victoria and the main gateway to Buvuma Islands. It is located a few kilometres off the Mukono-Njeru road. When the Jinja Kampala Expressway is constructed, as long as there is an interchange somewhere, Kiyindi and by extension Buvuma Islands will be very near to Kampala. By ferry, Buvuma is approximately one hour from Kiyindi. A new ferry is being built by the National Oil Palm Project (NOPP) of the Ministry of Agriculture, which will further cut the duration of the journey by about a half since it is said to be bigger. For many years, Buvuma has been a backwater district devoid of any meaningful development. The main economic activities have been small scale fishing, hand hoe-based subsistence agriculture, and charcoal burning. All this is changing as growing of oil palm is being extended there. Pathways have been graded into motorable roads and many people are now being employed in growing oil palm. There is unprecedented enthusiasm on the main island. Recently, the government has been buying land from willing sellers to establish the oil palm project, the second after Kalangala District. Before the growing of oil palms, an acre of land cost approximately Shs500,000. That figure has since grown to averagely Shs10m for prime land following land acquisitions by the government for the oil palm project. With household incomes set to grow and given the infrastructural developments in the area, Buvuma is the next frontier for those looking for long term investment. Buvuma, like many islands, boasts of kilometres of pristine sand beaches which could be developed into resorts, recreation centres, and/or holiday homes. Oil palm estates like in Malaysia and Indonesia can also provide another tourism attraction if packaged well. Palm oil is the most versatile vegetable oil in the world with many uses. But unlike Kalangala, Buvuma is so near Kampala and Jinja with a lot of potential for long term investors. Proposed infrastructure in terms of road and water transport will make it an island to die for. Investors could acquire land, a key means of production, when it is still affordable. Once electricity is generated, piped water extended, new docking areas built and factories set up for palm oil production, the prices will skyrocket. The government’s efforts to create a sustainable business on the island means that Buvuma District’s 90,000 population will have a lot of income. Unlike most other crops, oil palm trees are harvestable every 10 days once they reach maturity at about four years. A single tree lasts upwards of 25 years. The oil palm industry which is native to sub Saharan Africa is one of the major economic activities in Malaysia and Indonesia — the world’s leading producers of palm oil. Buvuma’s potential isn’t only in real estate and recreation. Banking and financial services, education, health and transport are among other sectors that are going to blossom. Factories to produce final products from palm oil can easily be set up. Leaders on the main island where oil palm project is being set up now need to embark on a campaign to change the mindset of the youth. In many parts of the country that are urbanizing, many young people simply want to fold their arms and wait for deals. They have watched a few people in Kampala that come on the scene driving fancy cars and throwing around money and they think that is the way to go — waiting for a big deal instead of working hard. As oil palm trees mature, households involved will demand for better standards of living. So, they will need better houses, cars, fashionable clothes etc. The youth of Buvuma who may not directly work in the oil palm sector should now acquire technical skills to provide the services. They can become mechanics, masons, fashion designers, electricians and beauticians among others. The writer is a communication and visibility consultant. djjuuko@gmail.com

August 23, 2021

News

Farmers in Buvuma applaud oil palm project

By Sierra Ruth Arinaitwe Joyce Namusobya has been a subsistence farmer based in Bukagali village on Buvuma Island for as long as she can remember, using her land to grow food for consumption. She couldn’t even utilize all the land she had. She didn’t know what to do with most of her land. That is however set to change. “I recently sold part of my land, receiving Shs17 million for two acres as a compensation from the National Oil Palm Project,” she says. “I used the money to buy another piece of land elsewhere and also bought cattle to diversify my income and also get some organic manure,” she explains with a measure of pride in her voice. Namusobya isn’t a lone figure on this island with such a story. Nasim Nangobi, a farmer in Kikongo village, says that she was paid Shs7 million for her three acres of land. “I used the money to buy another piece of land for myself,” she says. “We have been growing food crops just to eat at home. But by growing oil palm, we are going to be able to make some money and live better lives. We have been educated that if you own some land, it is wise to use some of it for oil palm growing and the rest for food crops like maize as we have always been doing,” she said. For the first 3-4 years before oil palm trees are ready for harvesting, farmers like Namusobya and Nangobi could actually utilize 100% of their land for food production through intercropping. “Intercropping ensures that farmers have food as they wait for their harvests. Once the harvests come in and as oil palm trees mature, then they have money to use to pay for their other needs,” explains Wilson Serunjogi, a farmer and the sub country chief of Nairambi in Buvuma. Charles Kalule, another farmer in Bukagali village concurs. “My land was surveyed to establish the acreage after I had been sensitized and agreed to sell some of it for the oil palm project. After I agreed to the value, I was advised to open a bank account where my money will be deposited,” he explains. When Kalule receives his money, like other sellers he will also get 30% on top of the value of his land as a disturbance allowance. “I am going to improve and uplift my family’s standards of living by building a better house and use the rest to improve my income,” he says. It is not only farmers who have sold land that will benefit from the project. Many youths are already employed in the nursery bed on four hectares where 1,944,000 seedlings are being prepared for planting this rainy season. Today, 154 people majority of whom are residents of Buvuma Islands are employed by the nursery bed. “We have the alternative livelihood programme that we are implementing in Buvuma where we are imparting residents with other skills. We know that not everyone will be working directly in the oil palm project,” Connie Magomu Masaba, the Project Manager of the National Oil Palm Project explains. Oil palm growing in Buvuma will be established on just one island out of 54 utilizing approximately 7,500 hectares out of more than 22,000 that constitute this particular island leaving the rest of the land for food production among other activities. In Kalangala, the first area where commercial oil palm growing has been established, smallholder farmers’ incomes have grown significantly since they collectively earn approximately Shs2.9 billion every month. Oil palm trees are perennial crops which take 3-4 years to mature after which they are harvested every 10 days for 25 to 30 years thereby providing steady monthly income to smallholder farmers. They yield 8-10 times more than other vegetable oil crops such as sunflower and soybean. This means oil palm provides more returns on investment to farmers than many other vegetable oil crops. Following that success in Kalangala, NOPP under the auspices of the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF) with funding from International Fund for Agricultural Development (IFAD) decided to expand oil palm growing to other areas starting with Buvuma with an aim of rural transformation. To that effect, NOPP has been able to compensate over 7,400 tenants and landlords so far. Compensations continue as more willing sellers come on board after the ongoing sensitizations and land valuations. The RDC of Buvuma Godfrey Tilutya described this development as a “golden opportunity” which is going to transform Buvuma. “The project has already started creating employment opportunities and income generating opportunities for the residents of Buvuma. The people of Buvuma are going to benefit further as in the long run, the project comes along with better roads, improved health centers, better schools, and guest houses are going to be built which will lead to economic development of our area,” he said.

March 26, 2021