NDF - Financing for climate change and development projects

NCF 6: Improving climate resilience for small-scale coffee farming systems in Uganda through modeling of adaptation and mitigation potential in the coffee value chain

The project aims to create a climate change resilient coffee value chain in Uganda through the implementation of the farmer ownership model as well as investing in several mitigation and adaptation measures.

Improving climate resilience for small-scale coffee farming systems in Uganda through modeling of adaptation and mitigation potential in the coffee value chain.

Nordic Partner: NIRAS A/S
Local Partner: National Union of Coffee Agribusinesses and Farm Enterprises Ltd (NUCAFE)
Total Project Cost: EUR 864,500  
NCF Financing: EUR 499,886
Agreement Signed: 28 December 2016
Project type: Combination
Duration: 29 months

Project objective
The project will create a climate resilient community of smallholder coffee farming families from at least 20 rural community cooperatives. This will be done through i) investing in adaptation and mitigation measures across the value chain and ii) provide training and guidance on climate-smart agricultural practices, and iii) enhance farmers economic foundation through the introduction of the farmer ownership model.

Main results/outputs

  • Baseline Report including results of the quantification of potential emission reductions and adaptation benefits.
  • Technical note to UNFCCC on the potential for adaptation and mitigation actions in the Ugandan coffee value chain. 
  • Farmer Ownership Model improved and implemented with at least 90% of targeted beneficiary coffee farming families operating within the Farmer Ownership Model by the end of the project.
  • Pilot project implemented demonstrating adaptation and mitigation possibilities at farm and factory levels.
  • Specialty coffee brand developed and presented to buyers.
  • Upscale Report developed for national as well as international climate resilient coffee production value chain.

The project will identify the potential for adaptation and mitigation actions within the value chain of farmers associated with the National Union of Coffee Agribusinesses and Farmer Enterprises (NUCAFE). The most needed and feasible actions will thereafter be implemented to create the foundation for improving farmers ability to adapt to climate change as well as decreasing the emissions from several sources within the value chain. Furthermore, to create a green growth of the farmer community and provide a more sustainable livelihood for farmers, the project have a two folded approach of increasing their economic activity. The first approach is to increase the farmer's knowledge and usage of climate-smart agricultural practices. This will be done through providing guidebooks in at least 5 different local languages. In addition, around 2000 farmers will be trained to ensure alignment of using climate-smart agricultural practices. This is most important as the farmer's revenues is largely depending on the yields of coffee produced. By not changing their farmer practices, their yield can decrease significantly due to climate change. The second approach to creating a green growth within the farmer's community is to increase the revenue for each farmer by using the farmer ownership model. The model, see to it that the farmer is empowered to be responsible for value addition of their coffee instead of selling an unprocessed coffee bean directly after harvest. This will increase the farmer's independence of intermediate coffee buyers and will also, enable them to sell their processed coffee at a higher price than their previously unprocessed coffee.

Relevance for climate change
Coffee plays a leading role in the livelihood of Ugandans and contributes substantially to the national economy. Nearly  43% of farming households grow some coffee, and coffee has contributed an average 30% to the country's foreign  exchange earnings over the past 20 years. The current and past trends indicate that the timing of rainfall can vary  considerably while an analysis of average annual temperatures, shows a notable increase of approximately 0.5-1.2  °C for minimum temperatures and 0.6-0.9 °C for maximum temperatures.
Rising temperatures and erratic rainfall increase the risk of disease and pest infestations for the coffee plants. 
According to the Uganda's NAPA (2007), the total area suitable for growing Robusta coffee would be dramatically reduced with a temperature increase of 2 °C, as they are sensitive to increased temperatures as they grow on high altitudes. Climate change can by this matter, largely affect the small-scale coffee producers that can come to succumb to the pressure of outer natural forces.

Innovation aspects
According to the International Labour Organization (ILO), over 220 million working people in sub-Saharan Africa live on only US$2 a day, the majority being involved in the primary agricultural production. While agriculture is the dominant employer in Africa, involving over 60% of the population, agricultural value chains currently deprive farmers of over 90% of the retail value of their produce, leaving most of them unable to make savings, reinvestments, and improvement in their livelihoods. The separation of agricultural production from value addition processes cuts farmers off from the potentially significant profits that are achieved in the later stages of the value chain. Enhancing and expanding farmers’ roles and responsibilities along the commodity value chain can, through the implementation of the farmer ownership model, can, therefore, play a critical role in jump-starting farmers economic transformation.
This project brings innovation through using the farmer ownership model that aims to create  a climate resilient coffee farmer community that can prosper in a sustainable way. By also combining it with actually feasible investments and climate smart agricultural training, innovative solutions can be integrated into all steps of the coffee value chain in Uganda, thus creating a green growth within the sector.

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