African Traditional Herbal Research Clinic ... - Blackherbals.com

Continued from page 28 – Brewers Turn Food into Beer toLower CostsUsing cassava, says Mr. Jenkinson, is a way of furtherstrengthening the company’s Eagle beer concept whichencourages farmers to grow sorghum for better pricesand at a larger scale, in Uganda.Eagle, which is one of the low-end market brands ofNile Breweries, costs almost half the price of somepremium bands like Tusker Malt, Club and Nile Specialbrands.The locally produced high-end brands cost betweenShs1,800 and Shs4,000 depending on the retailer whileEagle and EABL’s Senator Lager cost betweenShs1,100 and Shs1,400. According to the beer makers,premium beer is expensive because their raw materialslike barley are imported from abroad.According to Finance Minister Syda Bbumba’s2009/10 budget speech, Uganda imports malted barleyequivalent to 25,000 metric tones annually at a cost ofabout Shs103 billion or $50 million.Cassava as a raw material is expected to lower the costof some premium beer below their current prices; it isalso likely to increase the cost of cassava – a benefit tofarmers – as well as competition between individualconsumers of cassava as food and the beer makers.The beer makers are also turning to local raw materialsas navigation past the imported barley tax instead takeadvantage of government’s incentives to the beerindustry including the reduction of tax.At the reading of the 2009/10 budget, Finance MinisterSyda Bbumba proposed to reduce excise duty on beerproduced, using locally grown materials from 60 percent to 40 per cent. The move was aimed atencouraging value addition and promoting the growthof sorghum and barley for beer production, in variousparts of Uganda.Mr. Buratovich, explained that besides reducing thecost of production through using cheaper materials, it isalso more profitable for businesses. This is because ofthe 20 per cent tax breaks the government puts onlocally produced products.While making beer cheaper and more available couldonly result into its abuse and consumption by teenagers,the brewers think it’s one way of getting people offharmful alcohol.Mr. Jenkinson argued that producing cheaper clearbeer, would convert people from indigenous alcohollike tonto, a local brew made out of bananas, as well aslocal gins like Kasese and waragi, which can bedangerous and unhealthy to people when abused.-33- Traditional African Clinic December 2009The move to venture into cassava has already received awarm reception from one of Uganda’s farmersassociation based on the impact of the use of sorghum inthe East part of the country.Mr. Frank Tumwebaze, the president Uganda NationalFarmers Federation (UNFFE) – an organization thatadvocates for friendly farmer policies, lauded the movetowards more local food crops for manufacturingpurposes. “We welcome their initiatives because theycreate market opportunities for our farmers and guaranteemarket prices,” Mr. Tumwebaze said in an interview onTuesday.Using the Epuripuri sorghum brand grown in easternUganda as an example, he said brewers have helpedincrease the price of the crop from Shs300 per kilo lastyear to Shs400. The expectation is that it would boostcassava growing in the country and make it morevaluable to farmers.He, however, warns farmers to keep a keen eye on thecontracts they sign with beer companies. This is because,under their contract farming agreements, prices are fixedand yet market prices often change.“We urge farmers to be mindful of the fact that pricestoday may not be the same tomorrow.” He also called onbrewers to include clauses that take care of marketchanges in the contracts so that farmers are not exploited.Both Nile and East African Breweries employ over15,000 farmers of UNFFE’s 200,000 farmers.But with the recent famine that has hit both Kenya andparts of Eastern and Northern Uganda, turning to morefood crops may not be welcomed by many stakeholdersin the agricultural sector. According to Ms. AnnunciataHakuza an economist at the Ministry of Agriculture,adopting cassava as a raw material for premium beer islikely to have food security implications if adopted.By using cassava they will reduce the food which isavailable for consumption,” Ms. Hakuza said in a phoneinterview on August 26.In Kenya, turning to sorghum for beer, has also led to apartnership between EABL, farmers and Equity Bankwhich is the nation’s fastest growing ban, according tothe East African newspaper. Under the partnership, JamesMwangi the bank’s Chief Executive Officer announced,they would lend up to $145,000 (Shs 297 million) tofarmers at a 20 per cent interest rate per annum.Equity’s money is now being used by Kenyan farmers tobuy quality seeds and fertilizers to boost sorghumproduction. With the extension of the bank to Uganda,Mr. Mwangi made this year announced that they wouldalso support the agricultural sector.☻☻☻☻☻☻