Two-decade banana project with almost no returns to show
The brains behind the project say it is anchored on ground-breaking science to produce Tooke, a green banana flour brand that seeks to hit the shelves and eat into a wheat-dominated global market by 2027. Photo / Courtesy
What you need to know:
- By 2027, when government expects to start production and export of banana flour, it will be 22 years of the project that has received more than Shs200b ($54m), but with very little to show
At the top of the serene Nyaruzinga hill in Bushenyi-Ishaka Municipality, there sits an extensive ‘green gold’ model farm and factory.
The banana value-addition project has received over Shs200b ($54m) in funding from taxpayers over the last two decades.
The project had been envisaged to transform bananas into high-quality products such as gluten-free banana flour, fibre, and industrial starch – for export.
The brains behind the project say it is anchored on ground-breaking science, agronomy, and technology to produce Tooke, a green banana flour brand that seeks to hit the shelves of stores and eat into a wheat-dominated global market by 2027.
Besides the two-decade lack of returns, nearly 3,000 farmers recruited to supply fresh bananas, have suffered the agony of waiting for the project factory to reach full processing capacity.
“Our bananas are rotting,” says Yosamu Katambira, 74. “We want the factory to increase capacity for us to supply many times a month. Our bananas will be gold only if they address the project’s flaws like capacity, price, extension services, and irrigation.”
“The 10 tonnes they require us to supply monthly are covered by 15 farmers, which means more than 380 farmers are left without demand. We can supply up to 10,000 tonnes a month,” says Selian Muhumuza, the Bumbaire Banana Farmers’ Cooperative Society chairman, one of the supplier groups, with 400 members. As potential consumers await the project’s first products to hit the stores and export markets, Uganda has imported at least 15,107 kilogrammes of banana flour varieties for commercial use between 2020 and now, spending more than Shs28m ($7,636), Uganda Revenue Authority data shows.
The flour is sourced from South Africa, Kenya, and Ethiopia.
Thus, the slow pace has seen competition from South America and Asia - whose countries ventured into banana research and development much later - overtake Uganda and dominate the export markets.
Contrasting models
Next door, Kenyan entrepreneurs have developed banana flour products on their own, setting up processing plants for both local and export markets.
In 2010, Eric Muthomi - Stawi Foods - conceived the idea of processing bananas into flour, and within two years, he had the products on shelves.
His initial investment was Shs140.2m ($38,320) in a facility that processed 20,000 kilogrammes of flour per month.
In Uganda, government, under Banana Industrial Research and Development Centre (BIRDC) continues to invest in a semi-automated plant with a daily processing capacity of 14 tonnes of fresh bananas.
In addition to billions sunk into the project since 2005, in the current financial year, government provided more Shs50b ($13.63m) to complete capitalisation of the company to transition into a self-sustaining business.
This allocation for just one year, is more 355 times the amount Stawi Foods invested for the entire project, which produces 91 tonnes of banana and other flours per year, with a turnover of Shs2.9b ($802,501) as of November 30, 2023.
Part of Stawi’s challenge is supply: Kenya is not as big a producer of bananas as Uganda. For instance, the company requires 10,000 kilogrammes of raw bananas to produce 1,000 kilogrammes of flour, according to a Nation Africa report.
However, in Uganda, supply exceeds what the factory can process.
According to National Agricultural Research Organisation, Uganda is the world’s second-largest producer of bananas after India, generating more than 12 million tonnes per year, of which, nearly 75 percent is consumed locally.
Despite its top position as a producer, Uganda ranks 40th in terms of export given the short term shelf life of unprocessed bananas.
However, for its capacity and range of products or lack of it, BIRDC is the first of its kind in Uganda and East Africa.
But, its return on investment, remains in doubt due to the time spent in incubation, while others have made significant progress in banana value addition and exports.
By 2027, it will be 22 years since the project was conceived, while leading countries such as Ecuador, India, and the Philippines, which now dominate the global market, took under five years to export banana flour.
There have been claims that whereas government has spent money on a banana peeling machine, it failed to work, which means that casual labourers have to be brought in occasionally to do the peeling manually. PHOTO / COURTESY
Bottomless pit, no fruit
Some analysts, thus argue that the Kenyan model has worked over a shorter period with minimal investment because it is a private enterprise and owner-funded, compared to BIRDC, which Buikwe MP Michael Lulume Bayiga, describes as “a bottomless pit” with no returns.
“This year, we refused to allocate it a single shilling but President Museveni called the shots and gave it Shs50b,” Dr Bayiga, who sits on the Parliamentary Budget Committee, says.
The committee toured the factory in April and declared no value for money invested so far. MPs say they are running out of patience on the project, whose end product remains elusive.
“When we visited the facility in April, the banana peeling machine failed to work. From our inquiries, we learnt that casual labourers are brought in to do the peeling manually because the machines don’t work and the flour used to make a few items is imported,” John Baptist Nambeshe, the Opposition chief whip and member of the Budget Committee, claims.
During the 2024/25 budget presentation in June, MPs greeted with jeers the Shs50b ($13.5m) that Finance Minister Matia Kasaija allocated the Presidential Initiative on Banana Development Project (PIBID) – now BIRDC - to support the construction of a drier farmhouse at the factory, pay salaries of 150 staff and casual labourers and complete capitalisation and transition into a self-sustaining business to service early export orders from South Korea, Saudi Arabia, Qatar, Italy, and the US.
But despite the jeers, Kasaija informed MPs that the “project has shown potential for import substitution by replacing wheat and providing gluten-free starch products”, which “have high global demand”.
Working on challenges
Prof Florence Isabirye Muranga, the BIRDC director general, says they are still working on challenges such as obtaining an ISO certification and the Food Safety Management System green light, which has been an ongoing and costly process.
“It is commensurate to understanding the difference between raising a child for the village vis-à-vis for the world stage. The demand for the product comes with a string of requisite requirements for compliance with the respective marketplace laws, regulations, and appetite,” she says.
To overcome the challenges of market access, BIRDC is working on forming joint ventures through trade representatives abroad, especially in the US. By partnering with local businesses, they hope to make market entry smoother.
In early August, executives from the Michigan-based DET Imports visited the banana flour factory to assess its capacity to supply the US market and expand culinary options for consumers, according to Tambouridis Angela Elaine, the company’s chief supply chain officer.
Another partner is Synergy Hub, a US company based in Chicago, Illinois, with which BIRDC is seeking an alliance to facilitate entry into the American market, which currently accounts for 36.7 percent of the banana flour exports.
