Africa’s first chain coffee factory opens
Jul 18, 2009
THE first factory that processes coffee to its final product in Africa for export to Europe was officially opened by President Yoweri Museveni yesterday. The Good African Coffee factory at Bugoloobi is the first coffee roasting and packaging factory in th
By David Mugabe
THE first factory that processes coffee to its final product in Africa for export to Europe was officially opened by President Yoweri Museveni yesterday.
The Good African Coffee factory at Bugoloobi is the first coffee roasting and packaging factory in the whole of Africa to export coffee to supermarkets in the UK.
The $1m factory is located on Fifth Street in Kampala’s industrial area. It has a capacity of producing three million kilogrammes annually.
The project fits into the Government’s value addition strategy and is a bold move to penetrate western markets with processed African products.
By having the whole chain of value addition done in Uganda, the company saves 45% of the entire costs of transporting green coffee beans to Dublin, Ireland, and having it roasted and packaged there.
Museveni called it part of the liberation process of Africa. “The total global coffee business is $144b. Out of this, all the coffee growing countries, including Brazil and Columbia, get only $15b. The rest goes to importing countries,†he noted.
“This is, therefore, a small step in the process of liberating ourselves from working for others.â€
Green coffee beans fetch an estimated $1 per kilo but when roasted and processed, they fetch $15.
Museveni thanked the proprietor, Andrew Rugasira, and promised government assistance to investors who are honest, serious and engage in value addition.
“If some in the private sector are reliable, we will come in and help, if you do well and do not let us down like some people have,†said Museveni.
“Today we celebrate a landmark, not just for Good African Coffee but for Africa as a continent. We are proud to be the first African company in an African country to be retaining the value addition at source,†Rugasira stated while opening the factory.
The company will make four types of single origin roast and ground coffee and one premium dried instant coffee.
Rugasira narrated how the project started in 2003 as a social enterprise in Kasese, Western Uganda, to link coffee growers directly to the market and bring the benefits of the global coffee value chain closer to the farmers.
Today, Rugasira says, 14,000 out-growers have been accredited to supply Arabica coffee to the factory at prices 30% to 40% above the prevailing market price.
The company will export coffee directly to global supermarket chain stores Tesco’s, Sainsbury and Waitrose in the United Kingdom, and Shoprite Checkers of South Africa.
According to Rugasira, over $2.5m has been invested in developing farmers’ infrastructure in Kasese and brand development programmes in the UK and South Africa. The money came from loans and shareholders’ capital. Setting up the factory alone has cost $1m, with the roasting machinery bought from China.
The Government invested $995,500 into the company as part of a private-public partnership in 2008. This investment is expected to be paid back with interest by 2013.
Rugasira, however, complained about the difficulties for Ugandan investors to access long term financing, which he blamed on lack of faith in the younger generation of entrepreneurs.
“Here, you cannot have long term capital. And if it is available, it is very expensive,†he noted.
According to Rugasira, 50% of the company’s tax profits will be invested back into sustainable programmes, defined by the communities as critical to their economic empowerment and social wellbeing.
Simon Kaheru, the company’s spokesperson, said priority now was to maintain the quality of the coffee beans among a selected but growing network of farmers. So far, the company has only sourced coffee from farmers in Kasese, where it maintains stringent quality controls.
“We have had farmers in neighbouring Bushenyi and Rukungiri districts expressing an interest in joining the network and adopting our agronomic practices and the wet processing technology,†said Kaheru. “We also source quality coffee from Kenya and Tanzania which we shall be roasting and packing in Uganda.â€
The coffee sector employs some 1 million Ugandans. Last year, Uganda fetched $388m by exporting 3.2million bags.
According to the Minister of Agriculture, Hope Mwesigye, coffee export is expected to decline this year to $340m due to a contracted global economy and reduced global demand.
THE first factory that processes coffee to its final product in Africa for export to Europe was officially opened by President Yoweri Museveni yesterday.
The Good African Coffee factory at Bugoloobi is the first coffee roasting and packaging factory in the whole of Africa to export coffee to supermarkets in the UK.
The $1m factory is located on Fifth Street in Kampala’s industrial area. It has a capacity of producing three million kilogrammes annually.
The project fits into the Government’s value addition strategy and is a bold move to penetrate western markets with processed African products.
By having the whole chain of value addition done in Uganda, the company saves 45% of the entire costs of transporting green coffee beans to Dublin, Ireland, and having it roasted and packaged there.
Museveni called it part of the liberation process of Africa. “The total global coffee business is $144b. Out of this, all the coffee growing countries, including Brazil and Columbia, get only $15b. The rest goes to importing countries,†he noted.
“This is, therefore, a small step in the process of liberating ourselves from working for others.â€
Green coffee beans fetch an estimated $1 per kilo but when roasted and processed, they fetch $15.
Museveni thanked the proprietor, Andrew Rugasira, and promised government assistance to investors who are honest, serious and engage in value addition.
“If some in the private sector are reliable, we will come in and help, if you do well and do not let us down like some people have,†said Museveni.
“Today we celebrate a landmark, not just for Good African Coffee but for Africa as a continent. We are proud to be the first African company in an African country to be retaining the value addition at source,†Rugasira stated while opening the factory.
The company will make four types of single origin roast and ground coffee and one premium dried instant coffee.
Rugasira narrated how the project started in 2003 as a social enterprise in Kasese, Western Uganda, to link coffee growers directly to the market and bring the benefits of the global coffee value chain closer to the farmers.
Today, Rugasira says, 14,000 out-growers have been accredited to supply Arabica coffee to the factory at prices 30% to 40% above the prevailing market price.
The company will export coffee directly to global supermarket chain stores Tesco’s, Sainsbury and Waitrose in the United Kingdom, and Shoprite Checkers of South Africa.
According to Rugasira, over $2.5m has been invested in developing farmers’ infrastructure in Kasese and brand development programmes in the UK and South Africa. The money came from loans and shareholders’ capital. Setting up the factory alone has cost $1m, with the roasting machinery bought from China.
The Government invested $995,500 into the company as part of a private-public partnership in 2008. This investment is expected to be paid back with interest by 2013.
Rugasira, however, complained about the difficulties for Ugandan investors to access long term financing, which he blamed on lack of faith in the younger generation of entrepreneurs.
“Here, you cannot have long term capital. And if it is available, it is very expensive,†he noted.
According to Rugasira, 50% of the company’s tax profits will be invested back into sustainable programmes, defined by the communities as critical to their economic empowerment and social wellbeing.
Simon Kaheru, the company’s spokesperson, said priority now was to maintain the quality of the coffee beans among a selected but growing network of farmers. So far, the company has only sourced coffee from farmers in Kasese, where it maintains stringent quality controls.
“We have had farmers in neighbouring Bushenyi and Rukungiri districts expressing an interest in joining the network and adopting our agronomic practices and the wet processing technology,†said Kaheru. “We also source quality coffee from Kenya and Tanzania which we shall be roasting and packing in Uganda.â€
The coffee sector employs some 1 million Ugandans. Last year, Uganda fetched $388m by exporting 3.2million bags.
According to the Minister of Agriculture, Hope Mwesigye, coffee export is expected to decline this year to $340m due to a contracted global economy and reduced global demand.