Private agricultural input market distribution in rural Eastern Uganda

The Government of Uganda (GOU) has embarked on a number of policy and institutional reforms in the last decade (1997-2000), which has led to the withdrawal of government from the supply of subsidized low cost inputs to farmers. The withdrawal of government from agricultural input markets was done in the attempt of increasing efficiency in the distribution system and raising productivity through more active participation of the private sector in the marketing system. Like many other sub-Saharan African economies that scaling down on public supported agricultural input programs, a gap was created in input delivery to farmers, which has not yet been filled by the private sector. Cross-sectional data collected from 30 randomly selected input stockists and 400 randomly selected farming households in Iganga and Kapchorwa district was used in the study to assess the level of participation in input delivery by the private sector and determine the underlying factors distinguishing (characterizing) their distribution patterns by identifying the demand side factors that characterize the establishment of private agricultural input businesses in the rural farming areas of Uganda. The study findings indicate that private input stockists in the rural areas of Kapchorwa and Iganga district are not evenly distributed. The study findings show that location factors such as easy access to input business premises by farmers and availability of market for agricultural inputs are the major motivations for input businesses establishment in rural areas. The main views pointed out for improvement of the distribution of input markets were improvement of the credit system and reduction of high input prices. The study findings show that in the rural areas of Iganga and Kapchorwa district input stockists locate more in areas where farmers are more mechanized in terms of ox-plough and tractor use. As a result of the level of mechanization, farmers in these areas grow maize on a relatively large scale and incur less labour input costs per hectare. Farmers in these areas perceive that they have reliable rainfall and that soils on their farms are generally poor and therefore invest more in purchased inputs, which results in high maize yields. The results also show that in these areas farmers have high levels of maize crop commercialization due to better access to output markets and better maize crop output prices. The study findings also show that in the rural areas of Iganga and Kapchorwa district there is higher agricultural productivity in terms of maize crop labour productivity in areas where there are relatively high numbers of inputs stockists compared to areas with low numbers of input stockists.