Economic viability of coffee nursery operations in Uganda

Abstract

This study determined the profitability and economic viability of coffee nursery operations in Uganda, as well as the factors that influence the economic viability of these operations using secondary data that was collected on CNOs from a total of 178 nursery operators, who were randomly selected. Data was analyzed using MS excel, descriptive statistics and logistic regression using Stata (version 14). The results indicate that coffee nursery operations are not profitable since the gross returns is negative as well as not economically viable because the BCR is 0.27, which is less than 1. The results indicate further that 61.24% of the coffee nurseries are operated by males while only 38.76% by females thus the participation of women in to this business is still low. 92.70% of the nurseries are formally registered while the remaining 7.30% are informal and all those formally registered nurseries (92.70%) have a savings bank account while 7.30% do not have. Most farmers (88.76%) apply fertilizers of different forms while 11.24% do not use fertilizers. Further, 87.64% of the farmers use chemicals such as pesticides and fungicides where as 12.36% do not apply any chemical. A great number of farmers use hired labour (96.07%) and only a few do not hire (3.93%). Logistic regression revealed that sex, type of the nursery and fertilizers and chemicals application have a significant effect on the economic viability of the coffee nurseries. Only sex and nursery type influence positively while fertilizers and chemical application influence negatively the economic viability of this agribusiness. It is thus concluded that agricultural policy makers should focus on ensuring that inputs prices are stabilized and/or subsidized as well as mitigating the prevalence of counterfeit agricultural inputs mainly fertilizers and chemicals.