Abstract:

Agricultural sector remains the backbone of Uganda’s economy and livelihoods with over 63.4% of the labour force is employed in the sector (1), contributes to more than 50% of country’s export earnings (2), and approximately 60% of manufacturing output (2).
However sector’s gross domestic product (GDP) stands at only 24% (3), and for the past 5 years the sector has only grown at an average of 3.9% per annum against set target of 6% per annum from 2015/16 to 2019/20 (3, 4). Slow sector growth is attributed to: (i) low agricultural production and productivity; (ii) poor storage infrastructure and post harvest management; (iii) low value addition; (iv) poor market access and low competitiveness of agro based products in domestic, regional, continental and international markets; (v) limited access to agricultural financial services and critical inputs; and (vi) poor coordination and inefficient institutions for planning and implementation of agro industrialization (5).
Amidst the above challenges, the sector has a huge untapped potential to contribute to country’s GDP and reduce poverty through employment creation, a reason for sector prioritization under agro-industrialisation, export promotion and private sector development strategies of the National Development Plan 2020/21 – 2024/25 (NDP III).
Livestock is one of the important agricultural sub-sector contributing about 7.5% to total GDP or 17% to agricultural GDP (6). In the recent past, dairy has become an important sub- sector i.e. dairy products are the third-largest agricultural exports for Uganda after coffee and fish (7). This explains why dairy is among the 10 prioritized commodities (coffee, tea, fisheries, cocoa, cotton, vegetable oil, beef, maize, dairy and cassava) earmarked for sustainable agro- industrialisation under NDP III due to its potential contribution to food security, nutrition and export earnings. Dairy contributes 50% of livestock sector GDP (7) and 3.4% to country’s export earnings (8). However, the growth potential for the dairy sector is still huge. For instance herd productivity is estimated at 3litres/cow/day for indigenous breeds and 5.7 litres/cow/day for cross breed (9) against a potential of 22 -40litres/cow/day, and only 40 -60% installed processing capacity is utilized (8). This calls for deep understanding of the bottlenecks hampering sub- sector growth to guide implementation of interventions to unlock this enormous potential.