Grains leaving and coming into the country will be subjected to strict quality controls as government moves to raise the profile of the produce, information from the Trade ministry indicates.
According to the national export development strategy developed by the ministry for the next five years, commodities such as maize, rice and simsim have been prioritised for value addition given their wide market and potential to generate foreign exchange.
To achieve this, the ministry has tasked the Uganda National Commodity Exchange (UNCE) to enforce quality test and ensure compliance of grains standards in order to formalise the industry.
“You know that the grain industry has been operating almost informally for so many years. Everybody dealing in grain or owning a maize mill would just go about business without adhering to any regulations. Our neighbours just walk in and out with our commodities because there was no proper structure,” Ms Kyambadde said in Kampala early in the week.
She added: “I am glad that UNCE is now in place and will work together with the warehouse receipt system to license and monitor our warehouses, given that this has been long overdue.”
Grain traders and owners of major warehouses have overwhelmingly welcomed the revitalized commodity exchange as a tool that will help reduce post-harvest losses of grains and boost national and regional trade.
New institution in place
UNCE has been instituted as the new body responsible for structured trading of grains in the country.
It replaces the now-defunct Uganda Commodity Exchange, which had been grappling with an array of operational setbacks and a low capital base since inception in 1998. Unlike the Uganda Commodity Exchange, which was fully owned by government, UNCE is largely a private-sector owned, with government owning just 20 per cent stake through the Uganda Development Corporation.
Between 30 and 40 per cent of grain produced annually is said to be lost due to lack of proper and modern storage facilities, let alone poor, undeveloped and unstructured marketing systems.
In 2012, the five East African Community (EAC) states agreed on the recommended moisture content for cereals and grains in the region.
new storage system
According to the executive director of the Grain Council of Uganda, Mr Wilfred Thembo-Mwesigwa, members have submitted 156,000 of the 550,000 metric tonnes available as initial good storage-capacity to kick-start the Warehouse Receipt System and the commodity exchange, slated for early September.
Deborah Kyarisiime, the acting executive director of the Uganda Warehouse Receipt System Authority, confirmed the development, saying about 30 grain traders have been pre-inspected for licensing, currently awaiting final clearance before being granted licences for operation as public warehouses.