CHARACTERISATION OF TRADED SHEA PRODUCTS AND SHEA MARKET

PLAYERS IN UGANDA*John.B.L Okullo **W. Odongo, **D. Sserunkuma

and *Joseph. Obua*Department of Forest Biology and Ecosystems

Management**Department of Agricultural Economics and

AgribusinessMakerere University P.O. Box 7062 Kampala,

Uganda

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BACKGROUND• Vast areas in N, NE

& NW Uganda is covered with shea trees

• Opportunities for and constraints to successful commercialization of shea nut products in Uganda remains largely undervalued and understudied.

ð The shea butter tree (Vitellaria paradoxa,syn. Butyrospermum) is a nutritional and economic resource of great importance across 19 countries of Sub-Saharan Africa (SSA).

ð It is a major component of the woody flora of the Sudan and Guinea savanna vegetation zones of SSA.

ð Throughout the shea belt, the shea fruit is an important nutritional resource as it ripens and falls during the annual ‘hungry season’,

ð when food stocks are lowest and agricultural requirements are highest for clearing and planting of crops with the coming of rains.

ð Internationally, SSA producers account for all global shea nut production and are the major source of global trade in unrefined shea butter.

• A large proportion of Ugandans living in shea rich areas have these kinds of children

• Subsistence production and trade in shea products

• Can improved markets and trade in shea products help AVERT THIS SITUTAION?

• These concerns provided the impetus for:

• Charcterising traded shea products and market players in Uganda;

• Mapping the value chain of shea nut products and;

• Analyzing major socio-economic factors that affect market participation by shea nut producers.

METHODOLOGY• The findings presented here in have

been compiled through:

• Conducting Participatory appraisal and household interviews within the shea belt of Uganda covering:• Lira, Katakwi, Pader, Kitgum, Arua

Moyo and Nebbi districts.

• Sample size: 160 shea collectors/processors as folows: Lira (40), Katakwi (30), Pader (30), Kitgum (20), Moyo (20) and Arua (20).

• The shea value chain was also be traced throughout the country up to the point the products leave the county.

Questionnaires, group discussions, observation and key informant interviews were used to collect data on:

• Shea producers, traders, organizations.

• social and demographic characteristics of the respondents

• Sourcing of shea nuts and shea oil Product markets

• Product destinations etc.

Data collection

Social and demographic characteristics of shea producersCharacteristic % respondents reporting

Sex

Male 20.7

Female 79.3

Marital status

Married 73.6

Single 5.7

Widowed 17.9

Divorced/separated 2.9

Occupation of the household head

Farmer 93.6

Businessman/woman 5

Salaried employee 1.4

Education level

None 38.6

Primary 50.7

Secondary 9.3

Tertiary 1.4

• Of the 160 respondents interviewed:üMajority (80%) were women meaning that shea

business is dominated by women.ü 94% were farmers and nearly 40% were uneducated.

• Few owners of gardens with shea trees have the right to the trees.

• Shea nuts and its products has not gained their full market potential in Uganda.

• Shea markets remain traditional, concentrated in the shea producing areas, with low volumes of sales and high levels of domestic consumption.

Characteristics of shea producers/shea markets

• Shea products trade involves gathering of nuts, storage, processing of oil and marketing.

• Locally regarded as a preserve of women and children.

• It is called an “opportunistic business” because no one has ownership rights over many shea trees

• Shea fruits (Nuts) are gathered by any one with interest.

Shea product trade

1. High levels of consumption of the shea oil in the shea belt

2. Lack of proper market linkages between gatherers and users within and outside Uganda

3. Lack of adequate commercial markets in which to trade the commodity

4. Lack of market information and awareness of the higher market opportunities for the commodity.

Proper trade in shea products is limited by:

Training in shea gathering, processing and marketing

• 72.1% of shea producers interviewed had not got any formal training in shea gathering, processing or marketing.

• The few trained are members of the Shea Project in Lira and Pader districts.

• Indigenous knowledge of production, storage and processing shea is commonly used

Trainings attended Percentage of respondents

Gathering 12.9

Marketing 0.7

Gathering and Processing

1.4

Gathering and Marketing

2.1

Gathering, Processing and Marketing

10.7

None (indigenous knowledge)

72.1

Shea products and their usesProduct Use(s) % Respondents Reporting

Shea nuts Produce shea oil 100

Sold for cash 57.9

Shea oil Baby oilMedicine (treat skin and throat infections) Cooking oil Mixed with simsim paste and eatenLubricant (machines and bicycles)Soap making

69.865.576.378.440.330.7

Wood Poles for buildingFirewood for cookingTimberPounding motorCharcoal

64.069.160.476.269.8

Bark Treat malariaTreat tooth defectsTreat diarrhea

29.522.320.1

Fruit Eaten 58.3

Seed cake FertilizerBurnt to make soda ashUse for killing termites

40.838.450.3

Wax Treating cut wounds 30.3

Shea market players• The shea business is

dominated by local producers and consumers.

• The same persons gather nuts, process and sell the oil in the local markets found mainly in the shea zone.

• Few markets exist outside the zone because limited awareness about the qualities of shea oil among communities outside the shea zone

• Local market players comprise retailers, itinerant traders, wholesalers and business organizations.

• Less that 20% of the shea producers sell their nuts to organizations such as:• The Northern Uganda

shea Processors’Association _NUSPA) in Lira, Guru Nanak Oil Mills in Lira and CREAM in West Nile.

Key players in shea and related products trade•Markets for shea nuts were dominated by few organisations who buy nuts from the gatherers. •They monopolize the markets because they offered the only reliable market for shea nuts. •These organizations included:

•KFP/KM international Trade (Markets: USA, Germany, Poland, kenya) •NOGAMU – National Organic Agric. Mov’t of Uganda (Local- Uganda)•The Shea Project-COVOL-Lira (Markets: Local/ International)•CREAM–Comm. Org. for Rural Enterprise Activity mngt (Local- Uganda) •Guru Nanak Oil Mil -GNOM Inc. (markets:East Africa, Europe, India, USA)

•Through their lead organization, NOGAMU, these organizations mainly export shea nuts and unprocessed shea oil to USA, Germany, Poland and China amongst other countries. •There are limited sales to the local communities as most of the organisations are located in Kampala, where there is limited knowledge amongst consumers about various shea products and their uses.

Type of market

% Description

Farm gate 80.3 · Gatherers and processors sell their products from home.

· Organisations also buy from homes because of trust and product traceability.

Village 38.6 · Village markets are outlets for local gatherers and processors.

· Retail market for local consumers.

· Bulking up market for itinerant traders.

Periodic 11.4 · Local processors retail shea oil to local consumers.

· Weekly markets receive shea products from across the shea zone.

Wholesale 13.6 · Not properly established· Mainly operated by

organisations who sell their products in bulk to retailers and industrial processors.

A Range of shea products in the National market

The value chain for shea nuts

ð The value chain of shea nuts comprises four stages; input supply, gathering, processing and marketing.

ð The input in the shea nut chain is basically labour involved in the gathering of the nuts.

Input SupplyActors:

Households

GatheringActors:

Households

ProcessingActors:

Households, Organisations,

Retailers

MarketingActors:

Households,Organisations, Retailers,

Industries

The Value chain of shea oilð Shea oil is extracted through either cold or hot press.ð Locally, the inputs into hot pressed process include shea nuts, clay pots, ash, sand,

water, firewood, motar and pestle and labourð Inputs into the cold press process are shea nuts, the cold press machine, grinding mill,

saucepans, cloth sacks, water and labour.ð Locally, the consumption of shea oil follows the same trend as marketing. Within the

shea zone, ð locally processed shea oil is popular amongst consumers and is used for a variety of

purposes including food flavour, cooking oil and smearing babies.ð Cold pressed oil is mostly consumed by more liberal consumers in Kampala city.

ð The market for shea oil consists of households, cosmetic and pharmaceutical industries

Input supplyActors:

Households andInput manufacturers

ProductionActors: Households and Organisations

MarketingActors:

Households,Organisations and Retailers

ConsumptionActors: Households,

Industries

Challenges to improving marketing of shea products in Uganda

ð Lack of reliable market,

ð Low prices/Unstable/fluctuating prices

ð Competitive uses of shea tree (Fuelwood, poles, bark extracts etc)

ð Lack of proper transport

ð Lack of market information

ð Poor storage facilities

ð Crude processing techniques/skills

ð No planting culture-against traditions

ð No consistent methods/quality control

ð Long juvenility period

ð Variability in terms of germplasm source (Non-uniformity in fruiting and ripening and harvesting season)

ð Genetic influence on chemical profile?

OPPORTUNITIES???

1. Establishment of market information centres where shea communities can easily access market information.

• Improvements in market infrastructures within the shea zone would encourage market participation.

• Improved roads network for instance will enable traders from many organizations to access rural areas and purchase shea nuts as well as enabling shea producers to access potential markets easily.

2. More research on shea processing techniques and technology needed for improved processing and post-harvest handling

3. Development of uniform and shorter maturing shea trees (shortening of juvenile phase-Grafting etc|???) for promoting on-farm domestication both in-situ and ex-situ)

4. Enhancing naturally regenerating young shea or coppices (in-situ conservation)

5. Sensitization and provision of appropriate training in techniques of shea gathering, processing and marketing.

6. Certification premiums7. Involvement in Carbon Trade8. Grants (Gates Foundation, Market development Place, GEF etc)

THANK YOU