Seeds of Gold: How NUCAFE is helping to break generational poverty in Uganda

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The National Union of Coffee Agribusinesses and Farm Enterprises (NUCAFE) is a social enterprise of coffee farmers in Uganda whose membership currently comprises 200 farmer cooperatives and associations, consists of 215,120 farming families with 1,512,210 individual coffee farmers in the five coffee growing regions in Uganda. Uganda’s coffee export volumes now account for 7% of the world’s production

This is a unique union which brings together many farmers and helps them consolidate and equally value their sales.
NUCAFE was set up to assist coffee farmers to profitably own their coffee along the value chain for their sustainable livelihood, and this is a reason why the United Nations Capital Development Fund (UNCDF) has supported them. Another reason is that they also employ people in their area, and provide locals with expertise on how to produce, assess and sell coffee, among other skills.
NUCAFE was set up to assist coffee farmers to profitably own their coffee along the value chain for their sustainable livelihood
The training center is open to 500 trainee cohorts. The center not only includes training, but also coaching and mentoring. When done with training, the participants are either retained or are taken up by other coffee companies, who work with NUCAFE or others they apply to. NUCAFE also encourages them to start their own entrepreneurial enterprises and has the ability to connect them to other buyers in their areas.
The Executive Director of NUCAFE, Joseph Nkanda, asserted: “We speak to 10 SDGs. This includes partnerships. In a year we will be able to hold 36,000 tons of coffee beans. We will require 12 million dollars to move forward.”
NUCAFE works with 215 cooperatives who benefit approximately 250,000 families. The cooperatives act as middlepersons that connect the rural areas with the factory. Nkanda confirms that 90 percent of the profit they make goes back to the farmer, the 10 percent remains with cooperatives and NUCAFE. The cooperatives themselves are created by NUCAFE, through a due diligence processes prior to linking them to financial institutions.
To put it in clearer terms, Nkanda explained: “If the families contributing [their produce] would have an increase in 250 percent of the value added, we allow the farmer to upgrade in the value chain. We aim to break that generational poverty by allowing all generations to add value. They are also more likely to invest better in solar power and put their kids in schools and improve their shelters and build permanent houses.”
NUCAFE currently works with other countries in the region, boosting South-South Cooperation. Currently they have ties with companies in Rwanda and Burundi. Moreover, they are excited about a collaboration with Brazil and they have created an agri-business incubator in Makerere University.
“Coffee skills are lacking, we don’t have them in our university. They lack the skills; we operate as an academy. [Interested parties] come with agri-business ideas that turn into real business plans. We would like to create our own courses. The ones that we have were passed on from Britain, the curricula lack the local narrative,” said Nkanda, while holding some of the newly-roasted coffee beans in the palm of his hands.

UNCDF provided NUCAFE technical assistance to develop a bankable project and issued a seed grant of US$ 225,000, which unlocked US$ 1.7m from other financiers, including the Uganda Development Bank. The coffee processing equipment, additional warehousing and training space procured with this money enabled NUCAFE to scale up its operations, increase output and improve quality of the final product.
At the same time, NUCAFE was a beneficiary of UNCDF’s Innovate4Agriculture Innovation Challenge.
The seed capital offered by this Innovation Challenge helped NUCAFE to design and introduce a customized agro-food traceability digital system for agri-value chain management (traceability, aggregation and bulking, access to markets, access to information and loyalty).

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read: Why Ugandan Coffee farmers continue to live in viscous circle of poverty!

Traceability is an important factor to prove the provenance of the final product, especially its organic varieties, and thus to command a higher market premium. Lastly, UNCDF introduced NUCAFE to the London Stock Exchange Group, where it qualified and was listed as one of the companies to Inspire Africa in 2019.
For the future, the company’s aims are to set up a Coffee Entrepreneurship Center, expand their business facility and also promote and franchise a newly opened coffeeshop brand they have started called Omukago Café. By 2030 they aim to do all the expansions, they want to create decent employment for approximately 10,000 people, nationally or locally.
Nkanda: “Our coffee is a coffee with a story, its coffee with a human face.”

also read: A Bank on a Mission: How Equity is Shaking Up Uganda’s Banking Industry

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