Uganda coffee exporters have met with Uganda’s Deputy Head of Mission to Beijing, China, Amb. Fred Mugisha, to strategize on how to penetrate the China market.

The meeting held on 15^th April 2022 in Kampala, was a follow up of the first ever Uganda Coffee Day simultaneously held on March 17, 2022 in Uganda and China and was convened to discuss the coffee opportunities in China and the issues raised by coffee stakeholders in Guangzhou.

“We have been marketing and promoting Uganda coffee in China and of late, we have come across very serious[Chinese] companies that want to do joint ventures with Ugandan companies to get our coffee in the Chinese market,” Mugisha said.

China is the second biggest economy in the world with a huge middle class. Traditionally, Chinese were tea people but they are now shifting to coffee and according to Amb. Mugisha this provides Uganda a big opportunity. 

The Ambassador pledged the embassy’s support to exporters who are ready to do business in China. He noted that online marketing is the way to go and encouraged them to take advantage of the available online channels to market Ugandan coffee.

David Katungi, Director of Strategy and Business Development at Uganda Coffee Development Authority (UCDA), called on the exporters to embrace the opportunities in emerging markets such as China to sell their coffee. He reiterated Government’s pledge to support exporters and emphasized that Government has invested in interventions to increase production which will boost export.

“We have interventions geared towards increasing coffee production and productivity. In 2017, we launched the coffee roadmap whose target is to produce 20 million bags by 2025 and we are moving steadily towards that target and with the interventions that we have put in place such as providing seedlings to farmers, extension services and guiding farmers on good agricultural practices, we should be able to produce what is able to satisfy the market,” Katungi said. He encouraged stakeholders to continue investing in coffee before continuing to recount UCDA’s strategic interventions in China and other emerging markets.

“UCDA is working with Uganda’s foreign missions to promote coffee,” Katungi said. “Specifically, we have developed a coffee promotion strategy for China (which we will share with you at an opportune time). We are also in the process of developing an online marketing platform to explore the opportunity of promoting, and selling Uganda coffee online.”

The Acting Director Quality and Regulatory Services, Doreen Rweihangwe, notified the exporters that UCDA has profiled Uganda coffees according to agro ecological zones in partnership with Coffee Quality Institute (CQI). Exporters will be able to use the coffee profiles to market their coffee which is important for buyers who want to trace the coffee origin.

During the meeting attended by small and medium companies, exporters raised concerns such as the need for a warehouse in China, branding, marketing and promotion and trade financing among others.

“A warehouse is a necessity for us and the sooner we get it, the better for our entry into the Chinese market," Joseph Nkandu, the Executive Director at National Union of Coffee Agribusinesses and Farm Enterprises (NUCAFE), said. Nkandu also noted that there is need for the government to de-risk the market. He also stressed that there should be a deliberate effort to send young Ugandans to China to learn the language to prepare companies to do business in China.

Nkandu added that “finance is going to be an important factor” if Uganda coffee exporters are going to penetrate the Chinese market.

Aggrey Tumuhairwe, a partner in Kangumamu Agro processing and Exporters, a player already exploiting the Chinese market said that for Ugandan exporters to benefit from the China market, they will require an office there and will need to partner with Chinese companies. He said it is very difficult to break into the Chinese market without joint ventures. Tumuhairwe also noted that the quality of coffee and the consistency are key. He called on Government to support exporters through a brand awareness campaign of the country that will make Uganda known in China. This can then be supplemented with a coffee promotion campaign.

In an interview on the sidelines of the meeting, Katungi noted that Uganda has the capacity to satisfy the China market.

“We have seen a trend of several people entering the coffee industry to produce on a commercial level. There is a lot of land put under coffee production,” he said. “We see coffee production going up and investments going into it. So, we are confident that we have sufficient volumes to meet the huge market in China and other emerging markets.”

Katungi urged the exporters to build their capacity to provide quality coffee which will guarantee the market. The exporters, he emphasized, need to do due diligence to understand the needs of the coffee buyers in order to mobilize the kind of coffee required. In addition, they need to work together as no single exporter would be able to satisfy the market.

“Exporters would benefit more from this market if they came together and raised sufficient capital or meet the requirements because the volumes are high,” Katungi said. “Exporters should understand the dynamics of the China coffee market. One of those dynamics is that for one to supply and sustain supply they will need to partner with a local Chinese firm.”

Importantly, Katungi said that whereas China is a very unique market because of their culture, the general marketing principles apply. The exporters must ensure they meet the market quality requirements, they must be consistent with supply, they must be trusted and operate on pure acceptable business principles, he guided.

Coffee exports to China have been increasing over the years. For instance, Uganda exported 33,000 bags of coffee to China in 2018, 66,000 bags in 2019 and 83, 000 bags in 2020.

The Minister for State for Foreign Affairs, Hon. Okello Oryem, has reiterated Government of Uganda’s commitment to increase Coffee Exports to China.

The Minister made these remarks while speaking at the one-day Hybrid event, the 1st Uganda Coffee Day organized by the Consulate General of the Republic of Uganda in Guangzhou in conjunction with the Embassy of the Republic of Uganda in Beijing, the Uganda Coffee Development Authority (UCDA) which was convened with the purpose of increasing the volume of exported coffee and coffee products from Uganda to China.

The event which took place simultaneously in Guangzhou at Guangzhou Jinda Coffee & Beverages Market, one of the largest coffee markets in Southern China, and UCDA Offices in Kampala featured a coffee cupping and tasting of the latest harvest of coffee samples of both Robusta and Arabica coffee.

The main objective of this event was to promote the unique quality of Uganda Coffee in China, create partnerships for importation of Uganda coffee into China and attract investments in value addition in Uganda’s coffee sector.

The Uganda Coffee Day is one of the activities to be held in commemoration of 60 years of Uganda- China relations under the theme “60 years of Strategic Friendship and Cooperation between Uganda and China towards a Shared Future in a New Era”.

The Minister commended the efforts of Uganda’s Consulate in Guangzhou and Embassy in Beijing for convening this event noting that this is in fulfillment of the Ministry’s deliberate policy to pursue Economic and Commercial Diplomacy in a bid to strengthen bilateral trade with China.

Hon. Oyrem informed that H.E. President Yoweri Kaguta Museveni, directed the Uganda Coffee Development Authority to accelerate the coffee production from 3.5M 60kg to 20M by 2025. He affirmed that engagements like these will afford a necessary platform to explore the different ways on how this can be achieved.

The Minister further noted that Ugandan coffee is now ranked 3rd globally in terms of quality and Government is looking at ways of supporting the private sector to penetrate the Chinese market which will give the farmer a good place in the global trade.

H.E. Zhang Lizhong the Chinese Ambassador to Uganda lauded the excellent bilateral relations between China and Uganda. He further commended the efforts of the Uganda Consulate and Embassy in China and the Uganda Coffee Development Authority (UCDA) for organizing this event to promote coffee exports from Uganda to China.

The Ambassador further reiterated Government of China’s commitment to increase bilateral trade and informed that one of the ways to achieve this is through increased export of Uganda’s coffee which has a unique taste and flavor loved by a significant percentage of Chinese people.

He also informed of the commitment of the Chinese Embassy in Uganda to continue offering UCDA technical support to achieve this common goal for the mutual benefit of both parties.

Dr. Emmanuel Iyamulemye, the Managing Director at Uganda Coffee Development Authority (UCDA), revealed that “Uganda is coming to China in a big way.” He further informed that Uganda’s coffee first arrived in China in 2003 and today’s event is one of the activities aimed at finding ways of how Ugandan coffee can penetrate the Chinese market.

He added that Uganda’s coffee roadmap of increasing coffee production from 3.5m bags to 20m bags by 2030 has been informed by lessons worldwide in terms of the market. He highlighted that “For China, UCDA is looking at a structured approach to offset the imports deficit through increased export volumes of coffee with a focus on high-quality specialty.

Amb. Fred Mugisha, the Acting Ambassador to China appreciated Minister Hon. Okello Oryem and H.E. Zhang Lizhong the Chinese Ambassador to Uganda for gracing the function as well as reiterating commitment to increase coffee exports to the Republic of China.

In his remarks, Ambassador Fred Mugisha hailed the good relations between Uganda and China. He thanked Mr. Cai Shuqiang and his team for the support and collaboration in organizing the Uganda Coffee Day in Guangzhou under the theme“60 years of Strategic Friendship and Cooperation between Uganda and China towards a Shared Future in a New Era”

He highlighted that Memorandum of Understanding between Uganda and the People’s Republic of China gives Ugandan coffee access to the Chinese market. He encouraged coffee exporters to take advantage of this MOU to increase coffee exports to China.

Mr. Cai Shuqiang, the President of the Jinda Coffee Market in Guangzhou, thanked the staff of Uganda’s Consulate and Embassy in China and the Uganda Coffee Development Authority (UCDA) for organizing this event the 1st Uganda Coffee Day in Guangzhou.

The President underscored the enormous potential for Uganda coffee in China. He expressed commitment to partner with UCDA and any other willing Ugandan Coffee exporting company in the exportation of Uganda coffee to China. He further emphasized that he would organize and lead a delegation of Chinese Investors to Uganda to explore more opportunities in the coffee sector once the COVID-19 restrictions on travel in  China are reviewed.

According to statistics from UCDA China’s coffee market is estimated at US$11.5bn in annual sales and is expected to grow by 10% in the next five years. Additionally, Coffee consumption in China is growing at between 15%-20% annually. With the increasing volumes of organically grown coffee, Uganda has an advantage over other African countries to capture the China coffee market.

The event attracted key players in the coffee sector i.e coffee importers & exporters, traders, roasters, dealers in coffee machinery & related equipment, media practitioners and relevant Government departments. It was concluded with an award prize-giving ceremony for Uganda’s best coffees in cupping and tasting presided over by Mr. Jacky Lee Judge and Panel Chief in Guangzhou. The following coffee brands won different prizes with Sipi falls Natural Anaerobic from Kawacom (U) Ltd winning followed by Natural from Mountain Harvest and  Mt Elgon UTZ AAA washed Arabica coffee.

Hon. Fred Kyakulaga Bwino, the Minister of State for Agriculture, Ministry of Agriculture, Animal Industry and Fisheries has urged Uganda’s representatives at Expo 2020 in Dubai to pursue the leads generated to the end to ensure the country benefits from the experience of participating in the six-month long event.

The Minister was in Dubai to attend the Agricultural Thematic Week at Expo 2020. He appreciated the stakeholders present and commended them highly for representing Uganda in their different capacities and urged them to pick lessons they can use to transform their respective sectors back home.

“We should not just come to the Expo, stay for six months and go back [with nothing to show for it],” he told stakeholders at the Uganda pavilion. “We should at our various levels seriously think how much we can emulate this and benefit from it; how much was invested and how much has been recovered.”

Expo 2020 began on 1^st October 2021 and will run till 31^st March 2022.

According to Dr. Sam Omara, the Deputy Commissioner General of the Uganda pavilion, the country has exceeded its target of attracting Foreign Direct Investment (FDI) worth 4 billion shillings to Uganda by the end of the expo.

“The target of our participation at Expo 2020 was to attract FDI worth 4 billion shillings to Uganda by the end of the 6 months but as I speak now we have so far surpassed that by over 500 million shillings,” Dr. Omara said.

He revealed that there are several projects still underway and the figure is likely to go higher.

The most sought after agricultural products according to the pavilion director, Mr. J. B. Lwere, are coffee, tea, fruits and vegetables, among others. The exposure Uganda coffee has received at Expo 2020 is expected to increase exports to the region with several expressions of interest being received at the pavilion daily.

Coffee exports to the Middle East have been on the rise. In FY 2020/21, Uganda exported 127,519 60 kg bags of coffee compared to 82,249 bags the previous year.

According to Uganda Coffee Development Authority’s representative at the pavilion, Ms. Judith Engena, visitors appreciate Uganda’s coffee and have given it positive reviews. Engena said they have received several expressions of interest in both Arabica and Robusta coffee which they believe will translate into actual sales.

The Minister encouraged all present to work together to raise the country’s flag and move the nation forward and urged the stakeholders to ensure consistency in quality, quantity and volume of their products.

“The [export] opportunities are immense; we simply cannot exhaust the demand. The issues are well articulated regarding consistency in value and on volumes,” the Minister stated before adding, “The key driver in this is the Government. We will come up with a way to handle the entire value chain and segment the various markets.”

Picking up on issues raised in the meeting regarding quality and product packaging, Onzimai of PSFU informed the meeting that his organisation can provide solutions if they have the necessary information on what is required. He suggested that a team made up of representatives from the different stakeholders be commissioned to solve non-capital expenditure (non-CAPEX) issues.

“We have latitude to address non-CAPEX issues such as designing packaging, for companies to get certifications to access the markets, bringing products to the markets and building market linkages,” Onzimai said.

Also present at the meeting were Ambassador Elly Kamahungye Kafeero and Brain Mwanika from the Ministry of Foreign Affairs, Daniel Onzimai, an investment specialist from Private Sector Foundation Uganda, Lawrence Oketcho the director trade information at Uganda Export Promotions Board, private sector players and a team from Uganda Coffee Development Authority.

Uganda Coffee Development Authority (UCDA) has launched a campaign to stump old coffee trees and rehabilitate abandoned coffee gardens across the country to help increase productivity. 

Under the campaign, UCDA will train farmers on good agricultural practices (GAPS) such as stumping overgrown coffee trees to increase their yield. The Authority will also distribute fertilizers to coffee farmers who comply. 

The campaign titled “Renovate and Rehabilitate your Coffee; Every Tree Counts” was launched on December 10, 2020, at the annual coffee show held at the Kichwamba sub-county headquarters in Rubirizi district. 

The coffee show was organised by Café Africa, aBi Development and UCDA together with Rubirizi District local government. It brought together coffee farmers from western Uganda to learn, share experiences, and collectively find solutions affecting coffee farmers in the region. Unlike the coffee shows held in the past, this one was low key as the organisers endeavoured to adhere to the guidelines for managing the COVID-19 pandemic.

UCDA set up a demonstration plot of 100 Arabica coffee trees where good agricultural practices were demonstrated to participants. The practices included the correct spacing for Arabica and Robusta coffee, how to dig a hole to plant the seedling in, manure application, shade provision, watering, bending a coffee tree to increase productivity, mulching, soil and water conservation, pest and disease identification and control, weed management, fertilizer application, stumping and harvesting.

“After the training, the farmers realised that tall, old coffee trees cannot yield much, and they even make it difficult to carry out some activities such as picking, spraying and pest identification,” Emily Asiimwe, UCDA Regional Coffee Extension Officer said.

“We have trained the farmers on how to stump their coffee trees. This is in line with the campaign we have launched which calls on farmers to renovate and rehabilitate their coffee because every tree counts," she added. 

For the past couple of years, coffee farmers across the country have complained of low soil fertility levels which affect the amount of coffee they harvest every season.

To address this concern, UCDA developed a programme to support coffee farmers with fertilizers. The programme is in line with the fourth initiative of the Coffee Roadmap. The initiative aims to strengthen farmer organisations and producer cooperatives. By distributing fertilizers in the nationwide programme, UCDA aims to support farmers to increase productivity.

Last financial year, UCDA imported 100,000 bags of 25kg each of Fertiplus, an organic fertilizer, and conducted a pilot study before rolling out the national programme to coffee farmers organized in cooperatives or farmer organisations across the country.

During the show, farmers also called on UCDA to support them with pesticides and fungicides to use in the control of coffee pests and diseases most especially black coffee twig borer (BCTB), root mealy bugs, scales, coffee wilt disease (CWD), coffee red blister, and coffee leaf rust which continue to lower both quality and quantity of coffee produced in this sub-region.

In response, Asiimwe told the farmers that UCDA will soon support them with pesticides and fungicides to help fight pests and diseases.