Implication of Increasing Land Value on Land Tenure Security: Experiences from Kalangala Oil Palm Growers Trust, Uganda
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Authors: Samuel Mabikke, Nelson Basaalidde, Connie Magomu Masaba, Danilo Antonio, Solomon Mkumwa, Richard Kabuleta, John Gitau, Harold Liversage
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Implication of Increasing Land Value on Land Tenure Security: Experiences from Kalangala Oil Palm Growers Trust, Uganda
- 1. The Implications of Rising Land Value on Land Tenure Security Experience from Kalangala Oil Palm Growers’ Trust – Uganda Land and Poverty Conference 2016 Scaling up Responsible Land Governance 14-18 March, 2016 | Washington, DC Ministry of Agriculture, Animal Industry and Fisheries Vegetable Oil Development Project Nelson Basaalidde1 , Connie Magomu Masaba2 , Richard Nick Kabuleta2 , Samuel Mabikke3 , Solomon Mkumbwa3 , Danilo Antonio3 , John Gitau3 , Harold Liversage4 1. Kalangala Oil Palm Growers Trust (KOPGT) Uganda 2. Vegetable Oil Development Project (VODP) Uganda 3. Land and GLTN Unit, United Nations Human Settlement Programme (UN-Habitat) 4. International Fund for Agricultural Development (IFAD)
- 2. Introduction • Kalangala is a rural District – 70,000 people • Comprised of 84 Islands of Lake Victoria. • Oil Palm is on the main Island (Bugala) and 2 smaller Islands. • Kalangala depends on: Fishing, Lumbering, Agriculture, Livestock and lately tourism for livelihood. • Predominant cash crop is now oil palm. • The 3 Islands have turned into a market economy, due to oil palm. • Accordingly, land has therefore become a major tradeable asset.
- 3. Land Tenure Systems 1. Customary 2. Mailo 3. Freehold 4. Leasehold o Most land is held under Mailo Land Tenure o Some leaseholds on public land o Many “absentee landlords” and tenants Land Tenure in Kalangala
- 4. Kalangala Oil Palm Growers Trust (KOPGT). • Established and registered in 2005. • Target to establish 4,700 ha of oil palm plantations among oil palm growers in Kalangala District. • In partnership with GoU, OPUL and the Growers. • KOPGT has a Board of Trustees (BOT) and an operational Secretariat with a team of 28 staff. • KOPGT offer extension services and financial services to oil palm growers • Own 10% shares in the private company for the farmers. • IFAD, GoU and farmers fund KOPGT to run.
- 5. The Business Model. • Tripartite agreement signed in 2005. • Palm Oil Mill capacity – 20 tons of fruits per hr. • Oil Extraction at 20 – 22% of fruits is palm oil. • Hybrid: Nucleus estate/contract farming/joint venture • Smallholders: 1,600 farmers (578 women) harvest ffb & sell to OPUL; cultivate 3860ha Producers (Oil Palm Farmers) Public (GoU) Private Sect (OPUL) KOPGT
- 6. Overview of the Oil Palm PPP GoU: Purchased and leases land for nucleus estate; support smallholder involvement thru KOPGT); transportation infrastructure Oil Palm Uganda Limited (OPUL): Buys ffbs; manages nucleus estate of 6500ha and oil palm mill Kalangala Oil Palm Growers Trust (KOPGT): Intermediary between OPUL and Farmers and GoU;
- 7. Investment in Oil Palm ProjectInvestment in Oil Palm Project • IFAD Loan (USD 52M), • GOU (USD14M), • Private sector (USD70M), • Farmers (USD3.9M) • KOPGT (USD3.0M), • Reflows (US 4.4M) • Total funding USD 147million
- 8. Early results/Impact Farmers: 578 women participating in project as farmers in their own right Increased incomes ($390/month per Ha for mature plantations) Improved land rights (landless and women, purchase of land, demonstration of legitimate access to land) Women building houses, educating their children and setting up off farm businesses Community: Creation of employment (2,000 employed on nucleus estate, 500 in farmer gardens and 1,600 directly as farmers) Improved infrastructure (e.g. 750 km of road network and ferry service) and services (e.g. financial and public) Production in other crops, livestock and complementary agricultural activities, tourism and other non-agricultural enterprises is expanding
- 9. Implications on Land Value • Agricultural Land value has increased ten-fold. • An acre cost UGX 200,000 in 2005, • Today an acre costs approx UGX 2.5 million. • A land market has emerged on the 3 Islands. • Improved roads infrastructure, electricity, etc. • Increasing land conflicts. • Landlord vs. Tenant • Tenant vs. Tenant (boundaries) • Tenant vs. Government • Neighbouring Districts are demanding from Government to grow oil palm. • Returns on Oil Palm are higher than other cash crops.
- 10. KOPGT interventions • Farmer driven mapping process Mapping land, rights and claims using the Social tenure Domain Model (STDM) tool GLTN/UN-Habitat provided technical support Six implementing blocks on the main Island have been mapped. 1,200 farmers’ parcels with oil palm planted have been mapped and registered by KOPGT. • Arbitration in cases of conflict to find remedies. • Sensitisation of the affected tenants and landlords on the law and documentation. • Owners and tenants have confidence in KOPGT
- 11. Lessons Learned Effective partnership between rural smallholders and the private sector with positive development outcomes is possible Tenure security important for long term poverty reduction Simple practical steps can facilitate poor women and men in accessing land.
- 12. Lessons Learned Governments can play a positive role in agricultural investment projects (policy environment, mobilising smallholders, infrastructure and building trust) Choice of the business partners important -willingness to support smallholders Inclusion of smallholders in all decision-making processes (e.g. BOT) has been key to the project’s success Building partnerships takes time
- 14. Impact – local economy
- 15. Impact – national economy
- 17. The oil palm tree
- 18. On-farm grading and loading of fruits for delivery to the palm oil mill.On-farm grading and loading of fruits for delivery to the palm oil mill.
- 19. Thank you for listening.
Hinweis der Redaktion
- Thank you all for coming to visit us at KOPGT and also to visit the islands of palms and properity.
- Prior to the introduction of the oil palm enterprise, land had no significant value and was considered only valuable for subsistence purposes. With oil palm, an acre of land value has increased by more than ten-fold.
- Farmers were not in place in 2005, the mandate of the trust was therefore to represent the farmers’ interests in OPUL and also to mobilize, register and train them to participate in the scheme. Farmers were not in place in 2005, the rationale of establishing and funding of KOPGT lies in the successful R&D on oil palm in the country in the early 1970’s. Then, it was established that oil palm growing was viable in Kalangala. Too Kalangala needed an economic activity to intergrate into its domestic economy to boost development and reduce the overreliance on fishing and lumbering. The key mandate for KOPGT is to register the beneficiary farmers, offer extensin service, administer the credit scheme on behalf of Government of Uganda, market the farmers’ fruits, recover the advanced credit at the point of sale, be the custodian of the 10% share holding in OPUL and to participate in community support activities. KOPGT runs off the grants from Government and contributions by the farmers. In future KOPGT has to plan to be self sustaining in order to remain relevant.
- This PPPP model has proved to be a very successful one. Mainly due to the fact that Government has provided a favorable policy environment, the land is fertile and the strategic geographical location of the country in terms of marketing.
- Prior to the introduction of the oil palm enterprise, land had no significant value and was considered only valuable for subsistence purposes. With oil palm, an acre of land value has increased by more than ten-fold.
- Prior to the introduction of the oil palm enterprise, land had no significant value and was considered only valuable for subsistence purposes. With oil palm, an acre of land value has increased by more than ten-fold.
- These impacts are many and are partially attributed to the coming of the oil palm project on the island given the investment level.
- These impacts are many and are partially attributed to the coming of the oil palm project on the island given the investment level.
- Oil palm seeds are imported into Uganda as pre-germinates. They are then potted and watered till fully germinated. They are tended in a nursery for the first four months and later in larger pots for 12 months.
- This is how the palms look and the nature of the fruits they produce. The palm tree is unique in that it produces 2 types of vegetable oil. Palm oil and palm kernel oil. The outer mesocarp contains the oil used for cooking purposes while the inner kernel oil is mainly industrial.
- KOPGT is responsible for the collection from the growers, delivery/marketing to the palm oil mill of the farmers fresh fruit bunches (FFB).