Skip to main content

SOROTI FRUIT FACTORY, A POTENTIAL GAME CHANGER FOR EASTERN UGANDA


On the weekend President Yoweri Museveni commissioned the Soroti Fruit Factory, which promises to change the fortunes of fruit farmers in the Teso region.

"According to reports, the factory can process 129,000 tons of fruit annually or the equivalent of 3,225 trailer loads of fruit. There are 8.2 million fruit trees in the region, if each tree produces 80kg, the 656,000 tonnes resultant production will be more than sufficient to keep the factory running well into the future. Upgrades of the plant’s capacity is foreseeable very soon....

The factory’s products – packed juices, are to be sold locally and to the region.

The Teso Tropical Fruit Farmers’ Co-operative has complained that they have been receiving sh200 a kg for their produce but have seen a doubling of the price to sh500 a kg by the factory. The cooperative is a 20 percent partner in the enterprise. Government through Uganda Development Corporation (UDC) owns the remainder.

The factory is a $10.2mln investment done by South Korea and Uganda.

This single investment has got the potential to be a game changer in the Teso region and even further afield, if managed well.

The challenge for most farmers and the rural areas in particular is the lack of, quality inputs, knowledge of modern agricultural practices, to not only increase productivity but minimize post-harvest losses and access to markets.

I would like to believe that the promoters of the factory have already helped the farmers plant he appropriate varieties of fruit to supply the factory. Not any kind of orange or mango can produce the juice required to make the venture profitable and sustainable. So while there maybe millions of fruit trees in Teso their fruit may not be of the kind that the factory requires.

I read that 120 trees can be fitted on an acre. Is this the optimal number of trees? Is the spacing correct? With the addition of fertilizer can we get more trees on the land or push productivity higher than current estimates? How about pest control? How do we harvest the fruit and handle it to ensure that we not only minimize postharvest losses but also ensure that the quality delivered to the factory is top notch?

And finally the market. I saw that the initial juice will be sold in 200 ml pouches at sh1,500 each. Immediately I know that the target market will not be the rural areas but may compete favorably on the shelves of Kampala and other urban areas. I imagine with greater economies of scale they may bring down these prices.

Nevertheless, the processing and packaging lengthens the juice’s shelf life, meaning it can be transported much further afield than were it only fresh juice. Assuming a cost of production of sh750, factoring in distribution and marketing it’s hard to see how that juice can cost a dollar – about sh3,800 in any of its target markets.

"It is easy to think that there is an obvious market for juice, but there is a lot of competition from local, regional and international companies. The company’s marketing department will need to be very sharp to make inroads in the market. Just because the juice is locally produced is not enough of an incentive for people to take it up....

Building the factory is commendable and government should be lauded for it. But the factory is not the business.

The business may include providing extension services to the farmers, managing supply, production, marketing and distribution. Any part of this value chain can fail the whole enterprise. Which would be a crying shame.

It should not be allowed to fail, if only because it can encourage production in the Teso area, but it must be run on sound commercial principles so that the help it gives the fruit farmers can be sustained well into the future regardless of the circumstances.

And if it succeeds it could serve as useful pilot for other similar enterprises around the country.

We are poor because we have been unable to unlock the vast potential of our assets – the land and our people. Adding value to our produce will bring us one step closer to unlocking our incredible potential as a country.

Good luck Soroti Fruit Factory.







Labels:

Comments

Post a Comment

Popular posts from this blog

OUR HISTORICAL SITES SHOULD NOT GO UNATTENDED TO

Recently I was at Makerere University to attend a wedding ceremony. I hadn’t been on the university’s grounds in a while. I was shocked at how run down Mary Stuart and Lumumba Halls were. They are in need of serious work. These thoughts were reawakened with the recent launch of the coffee table book “Beyond the Reeds and Bricks” promoted by the tourism ministry, the cross cultural foundation of Uganda and the European Union Delegation. The book which is aimed at the protection of historical sites and buildings in Kampala, Entebbe and Jinja, is a moving collection of pictures of buildings and sites we know, but probably take for granted when we pass them as we go about our business. "Entebe za Mugula in Entebbe, Mackay’s Cave, the post office in Entebbe, the Stanbic Bank Branch in Jinja, Hamu Mukasa’s house in Mengo, the main building at Makerere , the Bahai Temple, Kibuli mosque and many other sites have pride of place among the 60 pictures in this book, which is ...
Post a Comment
Read more

NOT ONLY THE HARDWARE BUT THE SOFTWARE TOO

In the middle of September the United Nations released its annual Human Development Indicator (HDI). This index serves as an indicator of the quality of life of a country’s people by measuring the health, education, inequality, poverty and security standards. Aside from the statistical measures of development like GDP growth, this is obviously a better measure of how people are actually doing. In this year’s HDI report Uganda was ranked 162 out of 189 countries with a HDI score of 0.516. The index goes from zero to one, the nearer you are to one the better. Our score puts us in the low human development category. But as bad as that sounds we have been worse. In 1990, the earliest year that these figures were compiled our score was 0.311 even the UN recognises that we have improved 66 percent in the last three decades. According to the UN figures life expectancy has risen to 60.2 years   from 45.5 in 1990; expected years of schooling has doubled to 11.6 fr...
Post a Comment
Read more

THE MUKWANO I KNEW

We have lost the greatest Ugandan entrepreneur of our time, Mr Amirali Karmali, more popularly known as Mzee Mukwano. I have known Mzee Mukwano for more than 40 years and most of what I am today is due to him. And I am not alone. "He has helped countless people through school – as he did me. Helped countless more in business – as he did me. And he has been a steadfast friend and source of support to countless more – as he was to me.... I first met Mukwano around about 1977. My mother was the secretary for the chief of operations at Uganda Airlines, a man I knew only as Hamid. Mukwano had come to charter the Uganda Airlines’ Hercules plane and I happened to be around the office then. He was a short man, an unassuming man, but clearly a serious businessman who would charter the plane to bring in goods that were in high demand here. He run a popular whole sale shop in Nakasero – Egesa Commercial Agencies, a beehive of activity and the go-to place for anythin...
Post a Comment
Read more

WE NEED A BETTER SOLUTION FOR KAMPALA TRAFFIC

I am sure I am not the only one feeling it. Kampala’s traffic is becoming increasingly unbearable. Even the removal of roundabouts around the city seem to have an opposite effect to the intended purpose of easing traffic flow in the city. Kampala Capital City Authority (KCCA) has an ambitious plan of flyovers, underground tunnels and railway transport, which should help the cause, I hope. The snarl ups that we are coming fast accustomed to, are not only an issue of teeth grinding inconvenience but have a real cost on our economy by hampering and increasing the cost of doing business. A recent World Bank report suggests that as an economy, we are losing about sh3trillion annually due to traffic jams. The losses come in form of delayed deliveries, higher fuel consumption and the health consequences of seating in a smoke filled environment. To put this in perspective this is the combined budget of the health, agriculture and ICT ministries in this year’s budget. Or ...
Post a Comment
Read more

HOW TO RECOGNISE A PONZI AND NOT FALL VICTIM

Another Ponzi scheme has come crashing down around the ears of hundreds of “investors”. Unsurprisingly. In its recent reincarnation poor Ugandans were lured into a scheme where they bought computer tablets. This entitled them to a monthly pay off, $100, and a Christmas bonus for their children. In this case the unsuspecting investors -cum -victims were being given a share certificate. Meaning you accept to take the part of the risk in this project. Which was inadvertently reducing their burden of risk and liability for the issuing company. I leave that area to smart lawyers to handle.   As is always the case with these things, it’s not quite clear where the pay-out will come from. A common characteristic of these schemes is that you might get initial payments before you starting missing a few and the stories begin. The promoters of these schemes or scams often use the money from the latest entrants to pay the older “investors” until one of two things happen. Either...
Post a Comment
Read more

WE NEED FASTER TURN AROUND ON OUR ROAD PROJECTS

During a recent trip to China I was shocked to find properly paved roads and first class infrastructure deep in the countryside, hundreds of kilometres away from the capital, Beijing. I rode the high-speed railway out of Beijing, doing more than 300 kilometres per hour and I can attest I have never been on anything like it anywhere in the world. Not in Europe. Not in the States. Nowhere. I was blown away and wondered why we can’t at least do a tenth of this at home. I have to say I was pleasantly surprised when I used the Entebbe Expressway from the airport. I was in Kampala in under an hour. The Entebbe road had become a nightmare. I was shaken out of my good feeling when I had to make a trip to Tororo the other day. On my way back I spent two and half hours between Mukono and Kampala, about the same time it took me from Tororo up to Mukono. Clearly there is a lot of work to be done on our transport infrastructure. The full extent we probably don’t appreciate,...
Post a Comment
Read more