Knowledge Product
Agriculture Workers and Access to Land

Summary: IUF Study on Uganda

For the rural poor, secure access to land and related resources provides the most realistic opportunity to improve livelihoods and develop assets that can reduce their vulnerability. Rural households globally, however, are increasingly being deprived of land - their main source of production and the basis of their livelihoods. This is often a challenge facing households in rural areas where customary tenure prevails, such as in much of Uganda .

In Uganda , the land tenure system gives farmers access to land through their customary rights, but these are not easily transferred between generations. As a result, more and more young people without land are turning to agricultural labor as their only alternative. These workers do not own or rent the land on which they work, but labor in the fields and in the sugar refining factories. It is not without irony that families of these food producers are among the most vulnerable and food insecure.

In conjunction with the ILC, the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers' Associations (IUF) conducted a study over 2002-2003 concerning how and whether trends in the sugar industry in Uganda affected access to land for small-scale farmers. The full report, accessible through the ILC website, was based on a series of interviews with sugar-workers and analysis of three case studies of sugar plantations in Uganda .

Since 1996, the sugar industry in Uganda has experienced a steady increase in production. The industry, however, faces competitive challenges to produce at lower costs, because of the potential liberalization measures (e.g., gradual reduction of import duties as is specified under WTO agreement) and the EC-ACP negotiations. This has contributed to declining wages, poor working conditions, job insecurity and increased poverty.

Outgrowing schemes, the focus of the IUF report, are now being introduced as a potential way to increase sugar production at lower costs, while also increasing access to land for farmers. This approach is a shift from traditional commercial practices, in which plantations would physically expand through purchasing or leasing new land. In contrast, outgrowing relies on self-employed farmers, who own or lease their land, and who produce and supply sugar cane under contract to a plantation sugar company.

While outgrowing may prevent further land loss by small-scale farmers, the IUF study concludes that it also creates numerous structural obstacles for farming households to improve their livelihood. Small farmers engaged in contract production, for example, are obliged to accept company production methods and prices. They are locked into a production process that includes purchase of special seeds, special land preparation and compulsory use of plantation company support and technical services. Outgrowers, by contract, are committed to sell exclusively to the same company from which they purchase all their agricultural inputs.

These arrangements force most outgrowers into a credit system through which the plantation company provides a loan in kind, with an annual interest rate of 24 percent. Indebtedness has risen to as high as 40 percent for first harvest. Meanwhile, outgrows take on all the production risks that would otherwise have been the responsibility of the sugar company, if it managed production directly.

Despite these shortcomings, the study found that there were some advantages to small-scale farmers of the outgrowing approach. Contract farming improved the living conditions for farmers with more than 5 hectares of land, and has reduced production costs in the sugar industry overall. However, households must possess a minimum of 2 hectares of land to register as outgrowers, meaning that the poorest landholders (those who owned less than 2 Ha) do not benefit from the approach.

This report presents a case study on a prime example of how the lack of pro-poor policies in international trade agreements can have disastrous effects on the livelihoods of the world's poorest people. Secure access to land is the most realistic opportunity for the rural poor to overcome poverty and improve their livelihoods.

Changing Patterns Of Agricultural Production, Employment And Working Conditions In The Ugandan Sugar Industry PDF 111KB