Farmers must ensure quality for warehouse receipt system to succeed, says regulator

The success of the Warehouse Receipt System fundamentally depends on how farmers handle the primary production process, according to Ms Deborah Kyarasiime, the Uganda Warehouse Receipt System Authority executive director.

Speaking during a warehouses pre-licensing familiarisation tour for stakeholders in western Uganda, Ms Kyarasiime said ensuring that critical quality controls are put into consideration at the stages of plant care, harvesting and post-harvesting are a key driver in the success the Warehouse Receipt System.

The system, she said, is managed through a value chain that starts from crop farming and progresses into other stages such as grading, valuing, modern storage and marketing.

“We are moving closer to licensing the existing qualified warehouse operations. My humble [appeal is] for farmers … to ensure that crops are handled with quality requirements … farmers are at the bottom of the value chain, so if we get it right from the start, we are likely to get it right [all through],” Ms Kyarasiime said.

The pre-licensing familiarisation tour that was conducted the members of the Parliamentary Agriculture Committee sought to implore farmers to consistently follow quality guidelines while handling food crops.
This, Uganda Warehouse Receipt System Authority believes, will shield farmers against post-harvest losses and optimize returns on investment.

Mr Michael Werikhe, the Trade state minister, told journalists at a function to kick off the familiarization tour that a considerable number of farmers has not yet embraced the warehouse receipt systems thus missing out on the benefits that come with the system.

The government together with the private sector, he said, was considering boosting public awareness about the system to increase traction and participation.

According to Economic Policy Research Centre’s Agriculture Yearbook for 2019, much as deposits through the Warehouse Receipt System have grown slightly over the years from 2010, they are still below 30 per cent of the storage capacity of warehouses in the country.

The Warehouse Receipt Systems was introduced to enable farmers gain access to more profitable markets through pooling (depositing) properly harvested and handled produces in specified warehouses managed by certified operators.

Skills crucial

The Warehouse Receipt System requires managers to grade, weigh and issue receipts to farmers indicating the monetary value stored in the warehouse.

The receipts can be used to access financial services such as loans using their commodity as collateral just in case they have to borrow before the produce is sold.
The warehouse operators must ensure that the produces are stored under verified standards to ensure that the quality of the produces remain competitive at both local and international market fronts.

According to Ms Kyarasiime, the process to license warehouses will begin in January 2020, starting with at least seven and gradually add on more across the country. At least 18 types of grain produce are considered under the current arrangement.

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