Let us work together, factory boss tells tea farmers

KABAROLE- Methuselah Kasukaali, the chairperson board of directors of Mpanga Growers’ Tea Factory has appealed to cooperate with the factory’s management, saying the good relationship will sustain the tea business.

Kasukaali said farmers stopped supplying green leaf to the factory because of the leaf agents who entice them with daily cash yet it affects the long-term sustainability of the tea farms.

“Colleague shareholders, when we had a direct relationship with the farmer where farmers would put leaf direct to their respective numbers, it was easy to determine the input requirement and qualification for input,” Kasukaali said during the shareholders’ annual general meeting [AGM] at the factory premises.

He said the factory has experienced low production, leading to losses.

He said the company is ready to pay farmers for their green leaf on a weekly basis in their respective centres

Kasukaali noted that the company has had a business turnover of shs 5,170,381,000 in 2021 compared to Shs 3,193,826,000 in 2020 but made a loss of Shs 2, 195, 34,000 in 2021 compared to Shs 2,724,368,000.

He attributed the loss mainly to low production.

“The ideal annual production target for the company is supposed to be above 12,000,000Kgs to break even compared to 7,141,967 kilogrammes that were received in the year 2021,” he said.

Kasukaali revealed that the company had a closing stock of Shs 917,191,638 in 2021 compared to Shs 34,297.535 in 2020 and the total liabilities for the company as at December 31, 2021, were Shs 10,475,169,00 compared to Shs 12,697,984,000 in 2020.

He however noted that though they are trying to resolve the issue of quantity production by processing above the projected volumes of green leaf and subsequently going above the anticipated volumes of made tea, they are still faced with a big challenge of low prices in the Mombasa auction market.

“We are fetching low prices in the Mombasa auction because of the poor quality of our green leaf. We have a big task before us to ensure that farmers look into the farm practices, otherwise, the industry will continue to sink” he said.

The factory’s general manager, Saul Balisima Kusemererwa said despite facing some challenges, the factory has returned to normal operations after getting funding from Uganda Development Corporation [UDC].

Kusemererwa said UCD bought equity of Shs 4.34 billion on top of giving them a shareholder loan of Shs 6.34bln to enable the factory to operate at full capacity.

Farmers revealed that they pulled out from supplying tea to the factory because of poor pay and bad leadership.

According to the independent auditors’ report, the company has an accumulated loss of Shs 14,227,603,000 in 2021 and shs 13,271,088,000 in 2020.

The report further revealed that the net current liabilities are shs 5,366,413,000 in 2021 and Shs 7,323,517,000 in 2020.

https://thecooperator.news/tea-farmers-decry-high-prices-of-fertilisers/

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