Profitability of avocados in Mukono district, Uganda

Abstract

Avocado is emerging as one of the important “new export crops” in developing countries and farmers are expected to benefit enormously from the production and selling of the crop. The aim of this study was to analyze the profitability of avocados in Uganda. A case study of Mukono District. Data was collected using a structured questionnaire where a sample size of 120 respondents that included 70 farmers and 50 traders was used. Multi-linear regression model was used to analyze the factors that affected avocado production and the factors that affected the profitability avocados for farmers and traders in Mukono district. The gross margin analysis was used to estimate the profitability of avocado fruits for farmers and traders in Mukono district. The results revealed that, male farmers were more than female farmers and female traders were more than male traders, most farmers were within age category of 56-65 years and most traders were within age category of 26-35 years. Most farmers had primary level of education and most traders had secondary level of education. Majority of the farmers and traders were married. Factors such as education level of the farmer, climate conditions and total acreage had a positive significant effect on avocado production while lack of access to credit and not being in farmer organizations had negative significant effect on avocado production. The Gross margin of avocado farmers was 87.5% and that of avocado traders was 25.2%. The results showed that education level and demand had positive significant effect on avocado profitability among farmers while pests and diseases had negative significant effect on avocado profitability. The results also showed that lack of modern technology, not being in farmer organizations, lack of export opportunities, government policies had negative significant effect on avocado profitability among traders while access to market information had positive significance effect on avocado profitability. The following recommendations were suggested; creating awareness campaigns to educate both farmers and traders on the potential financial returns from avocados, Training, seminars and demonstration should be offered to farmers and traders to help them understand good agricultural practices, Farmers should be encouraged to grow grafted avocado varieties, initiatives such as bulk purchasing agreements, transportation subsidies and access to better supply chain logistics should be introduced in order to improve avocado profitability for traders and lastly, partnerships between farmers, traders and agricultural advisors should be established to foster a supportive ecosystem that addresses challenges collectively.