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Cotton wages fall far below median income, new report reveals
Workers in a cotton factory. PHOTO/FILE
What you need to know:
Cotton farmers earn significantly less than those growing other crops. Cotton is priced between Shs1,500 and Shs1,800 per kilogramme, while coffee can fetch around Shs15,000 per kilogramme.
A United Nations International Trade Centre report has revealed that the cotton sub-sector can create over 45,000 jobs annually if the untapped export potential is fully realised.
The report shows of the total job creation potential, 23,000 would be for women (50 percent); and over 13,000 for youth (30 percent).
Currently, this sector is estimated to employ over 2.5 million people, both directly and indirectly."
However, wages for direct jobs are below national median wage for cotton, textiles and apparel.
A kilogramme of cotton is sold between Shs1,500 and Shs1,800, resulting in a relatively low income for farmers compared to other crops like coffee.
According to the Uganda Coffee Development Authority, a kilogramme of coffee at farmgate ranges from Shs14,000 to Shs15,000.
As of 2024, the national minimum wage in Uganda is Shs130,000 per month.
The report indicates that, at the farming level, most activities are mainly done by youth and women.
“Activities like land preparation are mainly done by youth (80 percent) because of its labour-intensity. Young males are also involved in higher-skilled jobs such as mechanical, computerised and transportation,” the report shows.
Also, the potential for youth and women employed in the cotton value chain is concentrated at the production/farming stage and the ginneries when cotton is separated from the seed as this activity requires a lot of patience and care, and women and female youth (60 percent) occupy these positions.
According to Cotton World prices, lint production levels have fluctuated during the last decade as production increased from 2013/14 onwards, peaking in 2017/18 at 37,147 metric tonnes, but plummeted to 9,381 metric tonnes in FY2021-22.
Current cotton output is mostly exported, leaving little for domestic ginneries, which are currently operating at 10 percent of their optimal capacity.
Increasing imports of apparel and clothing indicate a growing domestic market, offering a wide scope for import substitution.
Average lint prices also increased during this period and cotton lint production (‘000 metric tonnes) because of high production costs, high cost of imported inputs like pesticides and fertilisers and competition for land and labour from other sectors, leading to consistent fluctuations in production as farmers opt for other enterprises with lower production costs like groundnuts and sorghum.
Fewer farmers participate in the cotton production process due to falling prices.
Current cotton output is mostly exported, leaving little for domestic ginneries, which are currently operating at 10 percent of their optimal capacity. Increasing imports of apparel and clothing indicate a growing domestic market, offering a wide scope for import substitution.
Spillover effects
Several by-products are produced locally: animal feed (cotton seed cake); oil extraction (hulls or husks); plastics; paper; medical supplies (cotton linters, surgical cotton wool) and edible oils (crude cottonseed oil).
State Minister for Trade Wilson Mbadi said the potential for value addition, with current engagement is limited to the lower end of the value chain.
“There is a progressive increase in returns from cotton at each stage of value addition: cotton lint ($1.4), yarn (USD 3), fabric ($5) and T-shirts ($12) ,” he said.
