Marketing tea for Uganda's smallholder sector

English: Literature shows that consumers and processors demand a particular good or product based on the utility they are able to derive from it, or on its ability to meet processing requirements. A riumber of studies have been conducted to model the relationship between price and the various quality attributes for a number of products such as vegetables, pork, beef, pineapples, etc. However, no such studies have previously been conducted on a product like tea, whose price determination is greatly dependent on the physical appearance and savoury. The quality of the various tea grades implicitly determines the price received by the producer. It is widely recognised in the tea fraternity that a good tea fetches a higher price. It is therefore of utmost importance to fully understand the impact of change in various quality attributes on the price of a particular tea grade. The absence of the ability to estimate the impact of change in quality attributes causes tea producers to make decisions without all the necessary information, which could in turn lead to losses in terms of price. Market research has tended to concentrate on seller concentration and has paid little attention to buyer concentration. Literature shows that buyer concentration exists commonly in agricultural markets due to the nature of the products. This study has shown that the level of buyer concentration at the Mombasa auction market is high. Therefore, there are legitimate concerns that the market will not guarantee an efficient price to the producer. The East African Tea Trade Association has an important role to play in ensuring that these concerns are dealt with by seeing to it that the rules and regulations do not encourage this to happen. Producers, on the other hand, may find the balance through increased market access, which will entail exploring other market alternatives and not being too dependent on the Mombasa auction market. There are a number of export opportunities in already established tea markets, which can easily be explored by the tea producers through increased promotional activities and trade alliances. Growth prospects are still greatly limited by the infrastructure, provision of financial and extension services, research, etc. The feeder road networks still remain in a very poor state, at times necessitating repairs by the factories so as to be able to collect green leaf. The government is still unable to provide an adequate agricultural extension service and the smallholder factories have had to start their own extension services. The government has recently embarked on a programme for the modernisation of agriculture, but this will only show tangible results if a conducive environment for agricultural trade in the country is created.