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Uganda Report

Marcopolis presents the Uganda Report focused on topics such as economy, investments and doing business, featuring interviews with Uganda's leaders. The sectors under review in this issue are agriculture & agribusiness, health & pharma, hospitality & tourism, industry, insurance, mining & petroleum, services and many more. 

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InterviewsFebruary 12, 2020

Agriculture Sector in Uganda: Grow More Seeds and Chemicals by Mohan Rao

Mohan Rao, Chairman of Grow More Seeds and Chemicals Limited (GMS)
Mohan Rao, Chairman of Grow More Seeds and Chemicals Limited (GMS)
Written by Sandra Francisco
Published: February 12, 2020

Interview with Mohan Rao, Chairman of Grow More Seeds and Chemicals Limited (GMS)

What is your assessment of the agriculture sector in Uganda and the region?

Agriculture is my passion and that is why we established this company. In the seed sector, we need to plan well three seasons in advance. Seeds cannot be produced instantaneously like other products. We also must be environmentally friendly. We are also dependent on rains and weather. The seed sector is very sensitive. If you produce a good seed, the country and the economy will grow and if you produce bad seed, the country and the economy will suffer. We supply quality seeds to the nation. Some people in the country take the grain, color it, and sell it in the local market without grading. Because of this, farmers are seeing heavy losses which reflects in the country as well.

Is the sector competitive?

We do not compromise on any procedure or quality policy. We are proud to be an ISO 9000 company in the seed sector.

There are many companies here in competition with us. The seed sector has a union called USTA, Uganda Seed Traders Association, which controls us and is under the Ministry of Agriculture. After monitoring all these things, individuals can still sell fake seeds in the local market without registering or following any other measures. This needs to be addressed by the government. If a farmer does not know where to buy seeds and goes to the local market and buys cheaper seeds, they may be at a disadvantage.

What are your competitive advantages?

We have invested heavily on the infrastructure and technology side. We have one farm and 30,000 outgrowers under us. We monitor using our agronomies and certify the seed. This is how we achieve quality seed. We do not compromise on any procedure or quality policy. We are proud to be an ISO 9000 company in the seed sector. We recently started using a color sorter to grade colors, which gives better quality. For example, with beans, we have many different colors. We can use the color sorter to sort out various colors and grade it out and find a uniform color to plant which results in the same color product.

Why do you need this color sorting technology? Is this for aesthetics?

It is mostly for beauty. It sorts out both variety and color. When you go to a European or US market, if you have mixed colors, people will assume it is lower grade and not buy it. When you see a uniform color, it is seen as good quality. We can sort out all the different types of wrongly colored beans.

What projects do you want to start in the future?

In the future, I want to bring in tissue culture technology to create hybrid varieties of fruits. There are a few labs but they belong to the government and are not privately owned. With a privately-owned lab, we can see development and business growth. We want to go mostly into horticulture. When we export fruits, we will get foreign currency income which is something we lack in this country. Once we can get foreign income, the country will prosper. Another aim is to achieve more yield with minimum land and minimum water. For that, we always look at new technologies. We are looking at irrigation using minimal water. We look at post-harvest issues as well. Many farmers do not have harvest storing facilities. They must go to district headquarters or hire a warehouse to store their goods. When they store their goods for 3 or 4 months, the price increases and farmers can get a better price for their product. What is happening in this country now is that traders are buying product at a lower price from the farmers that cannot afford storage, then turning around and selling for double the price. The trader benefits and the farmer loses. We are now bringing in silo bags with a 20-ton storage capacity for only $100. This increases the money the farmer can earn on their products. In the last six months we have received numerous inquiries and people like this idea so we are developing it for next season. We have silos but farmers do not have money until they sell their produce. They cannot transport from the farm to the silo areas or storage facilities. That is where the trader comes in, buys the product, and stores it. We wanted to come in and connect the farmer directly to get the benefit.

What other aspects are you involved in?

Agriculture is not financed well in the Ugandan banking sector. We want lower interest rate loans but it is not happening. The farmers are not able to get the financing they require. So, we have an outgrowers scheme where we supply seeds and fertilizer to the farmer. After the product is grown, we buy back from the farmers.

What do you do for irrigation?

Uganda is a God gifted country. Without irrigation we can grow two crops. My company policy is that with minimum land and minimum investment we want to grow more production. Once you irrigate, you will get a third crop which is a bonus for the farmer. We are pushing for small scale farmers to use irrigation and we are working closely with the Ministry of Water on other trial projects and schemes. After the trial project, we will put together a report of how the farmers can benefit from irrigation commercially and in terms of product.

What do you provide in chemicals?

We are not active in chemicals, but this country is somewhat lacking in this area. We want to import new chemicals but we are being met with some resistance from the Ministry of Agriculture. There are some biofertilizers and new technology out of the UK and we have been struggling to bring it here over the last year. This fertilizer is a ball shape and when you plant using it, the balls will suck up the water and retain it. When water is needed, it spreads back to the tree roots. We wanted to bring this technology here to better serve our farmers.

Are you involved in exports?

We export some cocoa products to Europe, including beans. Next month, we will commission a new plant with a one-ton cocoa mass per hour capacity. This is a value-added service which our President always pushes. Some trading companies are buying from us from Switzerland, Germany, and the Netherlands. We also have some Asian countries we export cocoa to like India and Thailand. We export red kidney beans to many Asian countries where they are staples. That is one of the main reasons we bought the color sorter. We want to give these beans the right quality to export.

Are you looking for technological partnerships?

We are partnered with Jain Irrigation in India. They have factories in Israel and Switzerland. They are one of the biggest companies worldwide for manufacturing irrigation equipment with 800 distributors. We have a joint venture with them and we share technology. We are looking forward to starting a distribution lab with them in Uganda. This was done through my own personal loan. There is a limit for everyone as an individual. We definitely need technological partners and financial partners to grow further.

Who are your clients?

Our clients include World Food Programme, World Vision, we work with many NGOs. They prefer quality. This is why most of our seeds go to NGOs rather than individual farmers. Individual farmers are looking for a cheaper price that I cannot supply.

Are you working on any other current projects?

We are partnered with Aba Trust. Our target is increasing the production of beans. We have a variety called Iron Vitamin Beans aimed specifically at pregnant women who need more iron. Through Abe, we have a grant to develop these seeds with farmers and train them on how to farm these beans. They also try to implement irrigation technology. We are looking at how to develop the best variety of beans such as climbing beans like red kidney beans. Our target with this client is 10 metric tons per year production.

What is your vision for the medium term? Where do you want the company to be in two to three years’ time? What do you want to achieve?

Our vision is minimum land, less water, and more production. Many of the people have land but they do not use mechanized systems so they cannot increase production. However, their expenses are still high. We want to show that mechanization leads to more profit for the farmer. We want to improve technology so that production will increase with less cost.

 

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