The potential of groundnut value addition on increasing household incomes in Kumi district, a case study of Kumi sub-county.

Abstract

Although it has been established that the Government of Uganda is currently advocating for value addition of various products in different parts of the country to increase household incomes through establishing policies, programs and projects to support farmers; little has been' seen towards the implementation of these ideas. This study sought to understand the groundnut value chain in Kumi district focusing on the key production practices, costs in groundnut production, value addition activities their status: as well as the effect they have on household incomes and lastly finding out the challenges faced by chain actors along the groundnut value chain. The study was done using a cross sectional survey design which allows examination of multiple factors achieving multiple outcomes in one single study. A multi-stage sampling procedure and probability random sampling technique was used to select representatives which me to get a representative from each study population in every parish, village and household that was selected. The sample size was then determined using the solvin’s formula used to calculate an appropriate sample size from a given population. The results of the study showed that the actors in the groundnut chain in Kumi district mainly deal in production of red beauty and Serenut groundnut varieties which are processed to get shelled groundnuts, roasted kennels and peanut butter mainly sold at the local trading center or the district town which leaves a. lot of other forms of groundnut activities and far markets unexploited in the district. Modern packaging and branding is barely seen in the sub county except for a few products found in the district towns which are from other districts Like Mbale and Kampala and groundnut production still remains a profitable business in the district. The study also discovered that the major challenge hindering farmers and traders from adding value is inadequate capital and the actors being comfortable at the stage of value chain they are at. The study recommends sensitization of farmers on value addition to enable farmers get the deserved benefit from groundnut production. The local government should also support farmers to form groups to enable them acquire machinery, request for value addition trainings and knowledge and increase their bargaining power in commanding higher prices for products and low prices for inputs. NGOs and the Government should constantly provide market information to farmers to strengthen the bargaining power of farmers- and help them make the right decisions when it comes to selling their products.