Uganda Juice Industry

Topics: Juice, Fruit, Pasteurization Pages: 7 (2047 words) Published: September 25, 2010
Overview
Agriculture and agricultural output are very important to the Ugandan economy. The agricultural industry is the largest employer of Ugandan's with 75% of the population earning a living from the industry. Food and agricultural raw materials account for 40% of the total exports from Uganda. Additionally, the sector contributes 22.7% to the Ugandan GDP. The large contribution of agricultural products to the Ugandan economy has led the government to promote value addition as a means of increasing the value of exports. According to the Ugandan Investment Authority (UIA), the demand for Uganda’s organic products is higher than the supply. This imbalance presents a high opportunity for export of organic fruit juice from Uganda. Fruits and farm produce are wasted or sold at very low prices during peak seasons due to inadequate storage facilities and lack of effective processing or preservation techniques, leading to high wastage levels. Juice production not only serves to add value to agricultural export but also serve as a way to prevent wastage of excess fruits. The juice industry has an opportunity to contribute to the Ugandan economy by increasing the value of the country’s exports and simultaneously preventing wastage of fruits so high in demand, and creating jobs for Ugandans. Industry Overview

The juice making industry in Uganda consists primarily of companies that produce “natural” fruit juices and companies that produce varying degrees of a mixture of fruit concentrate, fruit flavoring, sugar, and water. “Natural” juices in the Ugandan market are fruit drinks that consist primarily of juice extracted fruit flesh or pulp. The table below shows the two sectors and the ingredients for their juices. Industry SectorDescription/Contents

Flavored JuicesMixture of fruit juice concentrate, water and sugar Mixture of fruit puree, water, and sugar
Mixture of flavoring, water, coloring, and preservatives
Fruit JuicesJuice extracted from flesh or pulp of fruit.

The natural fruit juices are targeted towards the upper and middle income segment of the population while the fruit flavored juices are marketed towards children and the low income segment of the population. The flavored juice companies are distributed across the country while the natural fruit juice companies tend to be concentrated in the greater Kampala region. A key distinguishing factor of the fruit juice industry in Uganda is that companies that make the flavored juice drinks generally tend to be concentrated in the informal sector. These companies are usually small, employing between one to six people. The mixing of the flavored juices usually occurs in one of the entrepreneurs homes. The juices are then packed in polythene bags and distributed and sold through roadside kiosks and street vendors. The flavored juice companies are often not able to break into the formal sector because they lack capital to meet the operational and production requirements set by Ugandan National Bureau of Standards (UNBS) for juice producers. The natural juice producers tend to be larger organizations employing from between twenty to two hundred people. The juices are made in factories and then distributed to grocery stores, schools and other vendors. There are a lot of natural juices that are imported into Uganda. The table below shows the major players in the Ugandan Juice market. It is important to note that a lot of the flavored juice manufacturers are captured in this table because of the informal nature of those companies. Juice Industry Value Chain and Main Processes

Fruit Production
Fruit production is the responsibility of farmers. In the Ugandan market farmers can be classified in two groups: Small scale farmers
The majority Ugandan farmers fall into this category. These farmers are distributed across the country and grow fruits on relatively small plots (a few acres). Small scale farming is also characterized by a low use of...
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