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More Coffee Yields More Co-Operatives

by Harvest Money Editor
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Masaka is largely the ‘grandfather’ of coffee-growing in Uganda. The region was lucky that it was selected as one of the very first commercial coffee-growing areas in the early 1920s. The environment, being so near to Lake Victoria and the fertile soils all contributed to this choice.

The locals did not disappoint. They planted coffee depending on the size of their land holdings. Some planted as many as 20 acres. Such was the strength of coffee that towns like Masaka were actually developed by private people using earnings from coffee. In the 1960s and 1970s, what is now ‘Greater Masaka’ was the ‘Mecca’ of coffee farming in the country. This area included Masaka, Kalungu, Kyotera, Ssembabule, Rakai, Bukomansimbi and Lwengo.

At the time, Ssebatta Musisi was a young man, studying at St Henry’s College Kitovu and later St Marys College Kisubi. His father paid fees using earnings from coffee.

Although Musisi’s farm now sits in Lwengo district, he still prides himself in having witnessed the growth of Masaka City, thanks to coffee.

“This town you see was built using coffee,” Musisi, a coffee farmer, in Kingo, near Masaka says.

In Mpigi district, coffee is mainly grown in Buwama, Bunjako, Kammengo and Muduma sub-counties. In Greater Mukono, coffee is spread through areas of Nakifuma, Buikwe and Ntenjeru.

In all these areas, coffee growing was supported by a strong co-operative movement that started around the end of the 1920s. Among these included Masaka Union that catered for farmers in Greater Masaka area, Banyankore Kweterana which catered for areas of western Uganda, plus West Mengo Growers, among others.

Co-operatives in Uganda can be traced in Mubende district. where in 1913, four farmers decided to market their crops collectively. They became known as ‘The Kinakulya Growers’

They co-operated as a result of a response to the poor coffee and other product prices that Asian produce buyers gave to peasant farmers.

“In 1920, five groups of farmers in Mengo met in Kampala to form the “Buganda Growers Association”, whose supreme goal was to control the domestic and export marketing of members’ produce,” Fred Ahimbisibwe, who worked with the ministry of trade, industry and co-operatives says.

Counterparts in other parts of the country shared this vision and acted accordingly. A co-operative movement was thus born to fight the exploitative forcesof the colonial administrators and alien commercial interests, which thought to monopolise domestic and export marketing.

On the other hand, the colonialists and the coffee buyers did not like the emergence of these organised groups.

“The colonial government of the time considered the emergence of co-operatives as subversive. Laws were enacted to make it an offense for any financial institution to lend money to any African farmer,” Ahimbisibwe says.  Because of these restrictions, co-operatives operated underground until 1946 when the Co-operative Ordinance was enacted to legalise their operations. Peasant farmers saw the 1946 ordinance to increase government control in their business and many groups refused to register under it. Among others, the ordinance called upon them to register their names and be monitored by government.

“It was not the function of government to guide private enterprise as doing so, would arouse suspicion. The co-operative movement would be stronger if it was independent of government. It was a legitimate and reasonable aspiration of co-operative societies to be free of government control because it is not always good for government to influence the management of cooperatives,” Ahimbisibwe explains.

In light of the above pointer, the government amended the 1946 Co-operative Ordinance.  This gave rise to the Co-operative Societies Act 1952, which was accommodative and provided the framework for rapid economic development.

It provided enough autonomy to make registration acceptable to the coop groups that had defied the 1946 ordinance. It also provided for both the elimination of discriminatory price policies and offered private African access to coffee processing.

“Between 1952 and 1962 co-operative membership increased. The co-operative district unions acquired considerable importance,” Ahimbisibwe says.

Groups like West Mengo, Masaka Union and Banyankore Kweterana gained prominence as their membership grew.

By 1962, there were 14 ginneries and seven coffee curing works in the hands of co-operative unions. Many people were employed and co-operative unions became the most notable institutions in the districts.

“It was a privilege working for the co-operatives. They paid well and had a good understanding of the market,” says Alex Musisi who worked under co-operatives across the central region from 1970s up to 1994 when he retired. 

The co-operative had storage facilities for their members’ produce. They had trucks to transport produce from the villages to these storage facilities. They had constant linkages with markets across the world, which enabled them sell produce easily.

“Some of these, like Banyankore Kweterana gained so much wealth that they had over 50 trailers transporting produce. They had their own processing facilities too,” says Moses Magambo, who worked as a clerk at Banyankore Kweterana in the 70s.

Coffee farmers were assured of a market for their product under the co-operative systems.

“The co-operative supported the farmer with inputs and at harvest, a farmer simply delivered the produce to the nearest store,” Kibirige says. Sometimes farmers were paid promptly, while other times they were given promissory notes which they could even take to schools to guarantee their children’s school fees.

Patrick Lubega, who worked at the International Food Policy Research Institute (IFPRI), says the strength of the co-operative unions started dropping in 1969 after government created the Coffee Marketing Board (CMB) and similar cash crop commodity bodies.

“Previously, the co-operatives had been selling their produce directly to the markets in Europe, however, the creation of CMB meant that they now had to sell the produce through the body.

“The CMB operated as an intermediary between the co-operatives and the external markets. The price of key commodities like coffee was now set by CMB,” Lubega says. This obviously reduced their profit levels.

Before they could recover from this development, political turmoil started cutting through the country.  For example, Banyankore Kweterana lost a lot of property, including their main processing plant at Kakoba in Mbarara during the 1979 war, which was hit and destroyed by bombs during the fighting in Mbarara.

Then between 1982-1985, the same co-operative lost trucks and coffee stocks again.

“It was common for both government and rebel soldiers to commandeer trucks belonging to cooperatives to carry fighters into the war zones. Many of these trucks were never returned,” Magambo says. In 1983, The CMB was also grossly mismanaged as senior army officers took control over it. 

However, the final blow came in 1990 when the economy was liberalised.

“The liberalisation of the economy made doing coffee business more competitive for the cooperatives that had largely thrived as commodity monopolies,” Lubega says. With business opened up, hundreds of private buyers registered to buy coffee for example.

Before the liberalisation, a group like Bugisu Co-operative Union (BCU) collected around 10 million kg of coffee alone. But by 1994 soon after liberalisation, they collected just 2 million kg.

In recent years, there are new coffee co-operatives that have emerged, include Kibinge Coffee Farmers Cooperative Society, Gumutindo Coffee Cooperative and Ankole Coffee Producers Cooperative. Old groups like Masaka Union, Sebei Union, Banyankore Kweterana are also being revived.

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