Comparative economic analysis of primary coffee processing methods used by farmers in Rukungiri district
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Uganda is adopting a strategy to increase coffee production through providing free seedlings to farmers. The country projects its production to reach 20 million bags annually. Earnings from higher production can be increased through value addition at farm level through coffee processing. However, farmers need to be aware of the processing methods that are likely to give the highest returns. The main objective for this study was to conduct a comparative economic analysis of the different primary methods of coffee processing used by farmers and their effect on farmers’ income, with focus on Rukungiri district in Western Uganda. The Specific objectives of the study were: 1. To document the different primary coffee processing methods used by farmers; 2. To determine the factors influencing farmers’ choice of different primary processing methods; 3. To compare the profitability of the different primary methods of coffee processing used; and 4. To establish the challenges faced by farmers in primary coffee processing. Primary data collected from 90 coffee farmers were used. Data analysis was done using Statistical Package for Social Scientists (SPSS) version 16.0. Descriptive statistics, the probit model and gross margin analysis were used in the analysis. Results indicate that farmers are more likely to carry out primary processing of coffee as opposed to selling it fresh from the gardens when they are members of a farmer organisation. In addition, those who are likely to process coffee are more educated compared to their counter parts. On the other hand, coffee processing was less likely for female farmers, older farmers, and those coffee farmers with comparatively lower acreage of land allocated to coffee production. The major challenges faced by coffee farmers with respect to processing of coffee include abrupt weather changes, insufficient funds, limited storage facilities, limited market, theft, long duration that coffee takes to process (dry), high costs of hiring labor, and low coffee prices . The average gross margin of wet processing was Ugx.3958.39 per kg while that of dry processing of Ugx.3424.7707 per kg. This study recommends that more farmers be encouraged to practice wet processing of coffee due to the added benefits of value addition.