The central questions of this research are: (1) what drives and limits farmers’ inclusion
in the oilseed value chain in Uganda, and (2) what light does this shed on the implicit
assumptions of the value chain development (VCD) approach?
In VCD, the goal is to create value for farmers through access to more lucrative markets
and market information, fewer layers of middlemen, durability of trading relationships, and
improvements in productivity and quality, leading to better employment, household income,
food security and wellbeing.1 Value is created for the agro-industry through access to new
and reliable sources of supply.
VCD has three main elements that use a different entry point in the market system: a)
push, whereby small-scale farmers ‘cooperate to compete’ through producer organisation
(POs); b) pull, whereby agro-industry adopts inclusive business models that are adapted
to the realities of small-scale agriculture; and c) sector/market development, whereby
the necessary institutions, infrastructure, service and finance provision, an adequate
overall business climate are in place, and there is the right facilitation.
IIED and SNV set out to interrogate the theory of change of VCD and smallholder
inclusion with an initial focus on the oilseed sector in Uganda. The research was divided
into two phases. Phase I was conducted in three oilseed ‘hubs’: Arua in the northwest, Lira
in the north and Mbale in the northeast of Uganda, each with different market structures
and degrees of commercialisation. Each has a long history of VCD interventions by
multiple development agencies. Phase 2 focused on the Lira hub and the role of marketand
price-related risks in shaping marketing strategies and choice of market channel of
oilseed producers and their organisations, buying strategies of different types of oilseed
buyers, and implications for VCD interventions.