1.

PROJECT PROFILE 1.1 Project Overview

The SKY & LAKES LOWLAND RICE PLANTATION PROJECT proposes to establish a large scale mechanized commercial farm in Lyantonde District. The land being proposed for this project is a 200 acre (80.97 hectare) of uninhabited, fertile wetland bordering on Kiruhura District and Lyantonde District in South Western Uganda and ideally suited to rice growing. It is proposed that rice shall be grown, harvested, cleaned, milled, polished, graded, branded, packed and marketed. Farming infrastructure, machinery, processing plant and support facilities will therefore have to be procured and set up to go into production. Sky & Lakes was established to;

Set up an agricultural commercial rice scheme with a processing factory. Produce and profitably sell quality rice at competitive prices.

The company will grow rice on a commercial scale, mill and package it for both the domestic and export market. When fully operational, the SKY & LAKES LOWLAND RICE PLANTATION PROJECT shall be one of the biggest producers of rice in South Western Uganda. 1.2 Goal

Self sufficiency in rice production and complete substitution of imported rice by year 2015 Specific Objectives: 1. Contribute towards the development of a vibrant rice value chain that will attract investments for locally produced rice. 2. Contribute towards raising the rice production level from current 250,000 MT to 350,000 MT per year to remove the shortfall between demand and production by year 2015. 3. Raise the quality of locally produced rice to international standards. 4. Build a network of paddy producers around rice mills to ensure regular supply of paddy.

Justification Rice has become a priority crop in Ugandan Government strategies because of its potential to curb food insecurity and poverty. The Ugandan Government strategies emphasize rice as an emerging priority crop because of its potential to help reduce hunger and poverty. Of all the stable food crops, rice represents the country's best opportunity to significantly reduce imports. It also has the potential to create employment through production and processing. Currently the total demand stands at 350,000 metric tonnes per year of milled riceagainst the 250,000 tons produced thus leaving 100,000 metric tons deficit. On a daily basis the country is only able to produces 30 tonnes of Paddy (Not Milled) Rice and 20 tonnes of milled rice (Processed). Projections from the Uganda Upland Rice Millers shows that consumption is expected to increase to over 450,000 metric tonnes in the next five years. Currently Uganda imports rice worth $10m from Asia and another parchment from Tanzania worth $15m. The total population of Uganda is 35.873 million with annual growth rate of 3.2% (UBOS estimates) indicating that rice consumption is likely to increase. The worlds rice market is highly volatile. In order to fill this demand-supply deficitUganda imports rice brands from India, Pakistan, China, Kenya and Tanzania among other countries. Rice grows all across Uganda; hence self sufficiency is highly possible. 1.3 Strategy

1. Utilize the proposed 200-acre wetland as a cluster for lowland and irrigated lowland rice ecologies in Lyantonde District. 2. Use the proposed SKY & LAKES LOWLAND RICE PLANTATION PROJECT as a nucleus enterprise to organize the small holder farmers in Lyantonde District into cluster groups to aggregate them for access to improved technology seeds and other inputs- as well as market. This aggregation is a step towards reduction in production and transaction costs. 3. Increase in paddy production will be anchored on yield improvement per unit area (intensification) raising average yield per hectare from 1.5 MT to 7.14MT per hectare. 4. Link the out grower rice farmers (paddy producer network) in Lyantonde District clustering around the project to credit sources and to the benefits derivable from activities of NAADS in the acquisition of farm equipment and machinery.
2

1.4

Expected Output

1. A viable rice value chain capable of meeting the countrys rice demand put in place. 2. Conservation of foreign exchange earnings resulting from elimination of rice imports. 3. Diversification of the local Lyantonde District economy. 4. Food security resulting from doubling of rice production from 3 MT/ha to 7.14 MT /ha. 5. Income growth and poverty reduction for rice farmers. 6. Generation of additional 5,000 jobs in the rural area.

2.0

BACKGROUND INFORMATION 2.1 Ugandas Rice Sector

Rice production in Uganda started in 1942 mainly to feed the World War II soldiers, however due to a number of constraints, production remained minimal until 1974 when farmers appealed to the then government for assistance. In response, government identified the Doho swamps and constructed the Doho Rice Irrigation Scheme (DRS) with the help of Chinese experts. Figure 1; Production of Milled Rice in Uganda (2000 2010)

Milled rice production (thousands of tonnes)

250 200 150 100 50 0 2010 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Milled rice production (thousands of tonnes)

Today rice is grown mainly by small scale farmers almost throughout the country, but also with large scale farmers in few places. Total production is estimated at 250,000 metric tons of milled rice. Total rice consumption is estimated at 350,000 metric tons of milled rice. Population growth rate is 3.2% thus the demand for rice is expected to rise. Uganda adopted NERICA 1, 4 and 10 varieties in addition to the old lowland varieties. Since the introduction of upland rice in 2002, rice farming has grown from 4,000 farmers to over 35,000. From the earlier releases of three upland rice varieties in Uganda in 2002 courtesy of the Rockfeller support farmers were able to reap $9 million (14.9 billion) in 2005. In the process, the country has seen rice imports drop between 2005 and 2008. This trend of events according to the National Agricultural Research Organization (NARO) saved the country about $30 million (Ug. Shs. 75 billion) in foreign exchange earnings. Most rice in Uganda is grown in Eastern Uganda followed by Western Uganda due to
4

the presence of lowland with high moisture content throughout the growing season. Government of Uganda intends to increase rice production to cater for the ever increasing demand. 2.2 Status of Rice in National Policies

Agriculture is the main stay of Ugandas economy, contributing 42% of GDP, over 85% of export earnings, and providing employment for over 80% of the population, 90% of them live in the rural areas (Anon, 2004). Food crop production is predominant in the sector, contributing approximately 50% of agricultural GDP in 2012/13, while cash crops, livestock, fisheries and forestry provided 17, 16, 12 and 14 % respectively. The bulk of agricultural output comes from about 4.5 million small-scale subsistence households, 80% of whom, in average, each owns about 2ha of land and produces a number of different food and cash crops besides herding some livestock (UBOS, 2004). Agricultural production is also still predominantly rain-fed, non-market oriented, and based on rudimentary technologies and environmentally unsound practices. Resultantly, the countrys agricultural products are often of low volumes, poor quality and are costly to assemble for sustainable market supply. In addition, the farmers are not organized in accessing inputs and marketing their produce efficiently, thereby incurring high production and marketing costs that affect the profitability of their enterprises. Since agricultural sector embraces such a large proportion of the countrys population, the Government of Uganda (GoU) recognized the role of the sector in poverty eradication and is therefore implementing a Poverty Eradication Action Plan (PEAP), as the key national development agenda for a few decades to come (MFPED, 2000). The poverty focus envisages modern farming as the lead strategy to enable the poor raise their incomes and improve livelihoods. In order to meet this challenge, the Government has developed the Plan for the Modernisation of Agriculture (PMA) as a strategic framework within PEAP that provides for the transformation of the predominantly subsistence agriculture into a market-oriented sector of the national economy (MAAIF and MFPED, 2000). The strategy is designed to create an environment for promoting investments in profitable arable agriculture, livestock farming, and utilization of fisheries, forestry and other natural resources, while generating gainful employment in all sectors of the economy. The Ministry of Agriculture Animal Industry and Fisheries also recently demarcated the country into Agricultural Zones, each with specific production features that differ from the other. The intention, through this arrangement, is for each zone to undertake a set of
5

agricultural enterprises where it has the best comparative advantage, and thus cause rapid economic growth and reduce household poverty. Analysis of the ranking of enterprises by zones, as conducted by NAADS (NAADS, 2004), shows that rice growing as an enterprise now ranks high in many of these zones. 2.3 Consumer Preferences

Consumers prefer aromatic to non-aromatic rice, sticky to non-sticky, unbroken to broken and bulging after cooking to rice that does not bulge, white milled rice to brown. 2.4 Typology and Number of Rice Farmers, Processors and Traders

About 80% of rice farmers in Uganda are small scale farmers with acreage of less than 2 hectares using simple technologies including use of rudimentary tools, little or no fertilizer use, poor quality seed, with little or no irrigation and poor water management practices among others. About 15 % Medium scale farmers with acreage of 2 6hectares producing rice most of which using practices similar to small scale farmers and a few using non-motorized tools such as line markers. The major difference between medium and small scale is the acreage. About 5% rice farmers are large scale with land under cultivation over 6 hectares. Among the large scale farmers are rice schemes with acreage of over 1,000 hectares. Currently there are 591 operational rice mills. The rudimentary poor performing engelbergs account for 77.5%, milltops constitute 20.8% and medium to large scale are 1.7%. The small rice milling cottage factories using engelbergs and milltops mill 95% of the paddy produced in the country significantly contributing to persistent low quality and market value which is non- competition in the current liberated market economy. Trading of rice in Uganda is completely under the private sector. Most of the trading is done by middle men who buy threshed rice from the farmers at the farm. The price of rice varies from place to place between UShs. 1,500/= per kg to UShs. 2,500/= per kg of locally produced rice. This rice is usually packed in 50 and 100kg bags. Some medium and large scale processors however process, package and brand their rice thereby fetching higher market prices ranging from UShs. 2,500/= to UShs 7,500/= per Kg.

2.5

Comparative Advantage of Domestic Rice Production

Meanwhile rice, grown as both food and cash crop, has risen to second rank to maize after overtaking millet and sorghum. Local paddy production has risen from 190,000 metric tonnes (not milled) in 2007 to 350,000 metric tonnes (not milled) in 2012. The production motivated by economic objectives, is in line with the plan for modernization of Agriculture, a policy framework for eradicating poverty in the country. The situation now demands large commercial scale millers as automation in processing cereal foods is necessary for overall safety and efficiency. Domestic rice production is increasing and local and regional demand is also increasing. The current demand for rice in Uganda is over 350,000metric tonnes (MT) of milled rice which only 250,000 metric tonnes (MT) of milled rice are locally produced creating a deficit of 100,000MT. East African (Rwanda, Kenya, Tanzania, Uganda and Burundi) consumption is 2 million metric tonnes with imports of 550,000 metric tonnes of rice per year. Rice production would therefore provide an import substitution of about $120 million worth of rice every year to Uganda if it can double its production. This covers for only 15% of rice imports in East Africa.

3.0

OBJECTIVES OF PROPOSED PROJECT 3.1 Objectives

The main objectives and purpose for the project is multi-pronged, it aims at; a) To establish a good commercial venture to with a good return on investment in a short period. b) Enhance food security. c) Improving livelihood development of the local community through creation of employment opportunities. d) Improvement of farmers general knowledge and skills in agriculture and sustainable utilization of natural resources for environmental promotion and increased production. e) Increasing land productivity through promoting and encouraging farmers to adapt and adopt sustainable agricultural practices by making use of organic farming and irrigation technologies and mechanized agriculture. 3.2 Advantages of Growing Lowland Paddy Rice (NERICA 1, 4 & 10 varieties)

Short germination and maturity period i.e. only 30 50 days from planting to harvest. Higher yields (by 50% without fertilizer and by more than 200% with fertilizer). Resistance to local stresses. Contains more than 24% of protein contents. Not labour intensive. Savory taste and enticing aroma. No complication in cooking and take short cooking time which result in time and firewood saving, and gender sensitive as they give time to women to cater for other family chores. Excellent milling and marketability assuring farmers big benefits. The crop has been used by millions of farmers in Uganda to improve their livelihoods such as increasing food security, nutrition and household income. Lowland rice has been distinguished as a solution to both poverty and hunger. It has diverse characteristics that lead into profitable yields. Production cost is modest comparing to other types of this crop (total input per acre US$ 200 v/v output US$ 1,500) (Source APEP, Uganda). High yield production (i.e. planting 30 Kg in one acre can produce between 2,500-3,000 Kgs), short period labour intensiveness.
8

Any farmer can adapt and adopt the technology regardless of agricultural knowledge limitations, academic background, age or sex. It is always a one day training. Market is available locally and overseas. It is an employment creation activity.

4.0

PROJECT PROPOSAL

This project is designed to exploit all the available potentials to enable Lyantonde District in particular and Uganda in general attain self-sufficiency in rice and become a rice exporting nation a few years hence. This means expansion into the high potential areas, especially the lowland valley bottoms and alluvial lowland along major river basins and elaborate investment in irrigation infrastructure, particularly low-cost, small-scale diversion schemes in lowland valleys. Enhancement of productivity through intense use of agricultural inputs, technology and use of an on-farm rice-milling facility will be the approach. 4.1 Aim of the Project

The aim of the project is to attain self-sufficiency in local rice production by 2014. 4.2 Keys to Success

Our keys to success lie in the strength of our R&D (Research & Development) department. Profitability and sustenance of large scale commercial farming is underpinned by research into new varieties of seeds that have high yields, low maturity periods and are capable of resisting crop diseases, droughts while maintaining good taste, flavour and aroma. Sky & Lakes will invest heavily in research and development using skilled and experienced seed breeders and crop scientists. In addition, our keys to success will also include the following:

We intend to produce a final product of uncompromised quality so as to meet the needs and standards of our customers. Set an effective and efficient distribution network. This will ensure nationwide coverage and enable us respond rapidly to customer orders. We will install the latest modern rice processing technology at our factory. Keeping abreast with technology will ensure quality product, less post-harvest losses and higher returns. Foster loyalty and dedication amongst our staff by motivation and instituting welfare schemes. Rice production is a delicate business which demands total commitment of all employees. We realize that corporate commitment to success should lead to the survival and prosperity of our products and ultimately the whole company as a whole.

10

Marketing know-how: in an increasingly competitive market, there is need to aggressively market our products so as to be continuously at the top of our prospective and current customers minds. Stringent financial values and principles: we acknowledge the fact the financial and strategic management of the company will ultimately determine its prosperity and success. Hence we intend to adhere to stringent values and principles that will enable our objectives to be achieved. 4.3 Land and Ownership

To set up the commercial rice scheme, Sky & Lakes proposes to convert the 200 acres (80.97 hectares) wetland that marks the borderline between Lyantonde and Kiruhura Districts in South Western Uganda for the purpose of paddy rice growing and processing. This piece of wetland land is located at Biwolobo Parish, Lyantonde Sub County, Lyantonde District in South Western Uganda and is approximately 7 miles south of Lyantonde Town Council and lies just north of Lake Kachira which extends further south to Rakai and Isingiro Districts. SKY & LAKES LOWLAND RICE PLANTATION PROJECT proposes to lease this piece of wetland from the Lyantonde District Land Board through an appropriate and mutually agreed upon lease-term between the lessor and the lessee parties privy to the contract. 4.4

Suitability of Land and Advantages

At 200 acres (80.97 hectares), it is large enough to accommodate a modern medium-scale commercial rice farm, rice processing mill, silos and support infrastructure. The climate; weather and temperatures are ideal for rice cultivation. Soil tests have been carried out and found to be suitable for rice growing. Plenty of water to allow irrigation. Land is flat with few trees. No squatters. land is uninhabited (dormant land). The project is environmentally sustainable. Close proximity to Northern Tanzania and Rwanda makes access to one of the target markets of East Africa easier. Ugandas regional positioning and political stability has turned into a trade hub allowing businesses to easily access markets in the neighbouring countries of Congo, Kenya, S. Sudan, Tanzania, Rwanda and Burundi.

11

4.5

Major Demographic, Economic, Social and Cultural Factors

Increased rice production fits well into the overall social and economic trends. As the world population increases, the demand for food has equally increased making food security a paramount concern of governments and policy makers world-wide. In the first half of this century, the global demand for food, feed and fiber is expected to grow by 70%. Uganda has not been spared the boom in population. The population has increased from 12,000,000 in 1980 to 34,400,000 in 2012. It is projected to continue increasing at a rate of 3.5 % per annum. There is a need to feed this growing population. Rice has increasingly become the solution to food security. It is now the worlds staple food. In Uganda, it is one of the most widely consumed foods. Initially a preserve of the wealthy, increased household incomes have brought it within reach of most households. Total consumption in Uganda is estimated at 350,000 metric tons while production is estimated at 250,000 tonnes leaving a shortfall of 100,000 tones. It is estimated that approximately 75% of the rice produced in Uganda is consumed in the domestic market and the rest is exported to the neighbouring East African countries. However, while Uganda is turning into a regional supplier of rice, the country still imports rice from Pakistan, India and Vietnam. The demand for rice in Uganda and East Africa is high and is projected to grow higher. Sky & Lakes venture into the rice market is therefore apt and timely. 4.6 Government Intervention

Cognizant of the suitability of the Ugandan climate, the fertile soils and the availability of lowland for rice growing vis--vis the enormous potential of rice growing as a commercial venture coupled with its envisaged role in creating employment, raising household incomes and earning foreign exchange, the government of Uganda sought to promote rice growing by formulating suitable policies.

The Uganda National Rice Development Strategy (NRDS) 2009 was formulated to boost rice growing. No taxation on agricultural produce. No taxation on tractors, tillers, combine harvesters and other agricultural inputs. 75% tax duty on imported rice.
12

The government of Uganda through the Ministry of Agriculture sought partnership with Japanese International Development Cooperation (JICA) to establish NaCCRI (a technical agriculture support institution). It offers technical support to farmers on high yield seeds, optimum land use, water management and researches on farm inputs and avails the information. Has made grants available for irrigation schemes. Because of the abundance of food in Uganda, state involvement in the distribution of rice as is the case in many countries is non-existent. 4.7 Market Analysis

The East African regional market comprising of Uganda, Kenya, Tanzania, Rwanda, Burundi, South Sudan, Ethiopia, Somalia and Madagascar for white milled rice stands at 3.1 million tons. Of the above countries only Madagascar has attained near selfsufficiency in rice production. The rest of the countries have to rely on imports to meet their domestic demands. The market for rice in Uganda is 350,000 metric tons (Uganda Bureau of Statistics 2012), Kenyas is 460,000 metric tons. According to the Uganda Revenue Authority, Uganda spends 60,000,000 US dollars on imported rice to meet the shortfall in supply of rice while Kenya spends US 250,000,000 US dollars on imports of rice. While Uganda imports rice to cater for the shortfall in production, it also exports some of its locally produced rice to the neighboring countries of Kenya, South Sudan, Rwanda, Burundi and eastern Democratic Republic of the Congo. This is largely due abundance of foods in Uganda and the lack of restrictions on exports of food. 4.8 Market Segment in Uganda

SKY & LAKES LOWLAND RICE PLANTATION PROJECTwill target;

Mid to high end consumers of rice. International food aid organizations e.g. FAO/WFP. Schools and institutions. Army and Police Forces. 4.9 Market Segment outside Uganda

Kenya South Sudan Eastern Congo

13

Rwanda Burundi

5.0

ABOUT SKY & LAKES THE PROJECT IMPLEMENTING AGENT (PIA) 5.1 The Project Promoters of the Project

The Project Promoters of the Project 1. Local Investment Company Sky & Lakes 2. Lyantonde District (Local Government District in Uganda) The project proposes to develop a sustainable Commercial Agricultural, Economic and Business Community and development of trade, industrial, managerial, technical and skills capacity in Lyantonde District. The project will enhance local investment opportunities and Ugandas trade capacity, whilst ensuring business opportunities for local investors and contribute to food security for Uganda and other countries. The project when completed will earn Uganda foreign currency through export of farm produce. 5.2 Who We Are

Sky & Lakes, an agricultural investment lead company working to secure some of the best land in Uganda, and develop it for commercial farming. We are committed to contribute to the worlds food security and social stability, through regional economic and agricultural development in partnership with, community, private companies and public sector. Our business models and project types are designed in such way that it is affordable for a small farmer and suitable for large scale commercial farming. 5.3 Sky & Lakes Vision

Our vision is to be the leading technologically modern commercial rice scheme producing quality rice in Uganda and the East African market. 5.4 Sky & Lakes Mission Statement

To produce quality rice at competitive prices.

14

6.0

PRODUCTS

The SKY & LAKES LOWLAND RICE PLANTATION PROJECT Products: Sky & Lakes shall specialize in three types of rice varieties;

Super rice (an indigenous African long grain white rice with a nice aroma). NERICA 4 and 10 (a variant of African long grain and quick growing Asian rice). Basmati rice. Tests have been carried out that indicate that Basmati rice thrives well in wetland areas of South Western Uganda.

The SKY & LAKES LOWLAND RICE PLANTATION PROJECT will develop its brand and market its rice in Uganda and internationally under its brand. The SKY & LAKES LOWLAND RICE PLANTATION PROJECT will produce and market white milled rice. The rice shall be of quality texture, tantalizing flavor and aroma. The rice shall be packed in easy to carry, attractive paper bags of 1,2,5 and 10 kgs for the retailer trade and in 50 to 100kg jute bags for bulk purchasers and wholesalers. There shall be three different categories of Sky & Lakes rice; 1. Sky & Lakes classic 2. Sky & Lakes super 3. Sky & Lakes Basmati Some by-products from rice production and milling have found some commercial applications; 1. Rice straw: The straw contains fiber, carbohydrate, protein and traces of vitamins. It can be used as livestock feed, fertilizer, mushroom production, fuel for cooking, pulp and paper and as raw material for production of alcohol. 2. Rice hull and husks: Constitute 20% of the grain weight and can be used as a component of livestock feed, processed as fibre board or used as fuel/energy source. 3. The rice bran: It consists of 12 16% protein, 16 20% fat, 8 12% fibre and 7 10%ash. It can be processed into lubricating oil.

15

7.0

PROJECT IMPLEMENTATION STRATEGY

The proposed SKY & LAKES LOWLAND RICE PLANTATION PROJECT aims at utilizing a sizeable wetland area that constitutes the borderline between the districts of Kiruhura and Lyantonde and very close to Lake Kachira in South Western Uganda. This wetland which measures an approximately 200 acres (80.97 ha.) in size is not perceived as a major environmental or biodiversity conservation resource by the leading environmental protection and biodiversity conservation authorities in Uganda at the moment and given its vast size and proximity to one of the major trunk roads in Uganda (i.e. being located only 7 kms from Lyantonde Town on the Masaka Mbarara highway) offers an excellent agricultural production opportunity for lowland paddy rice cultivation that is well suited to such wetland environments. The primary motivation of the lead project promoter Mr. Ambrose Mutafungwa in making this proposal to the Lyantonde District Land Board is borne out by the fact that rice production is now one of the major interventions identified in the Ministry of Agriculture Animal Industry and Fisheries (MAAIF) Development Strategy and Investment Plan (DSIP) 2009/10 2013/14 for food security and poverty reduction in Uganda. By turning this patch of wetland into a long-term sustainable agricultural production area through the introduction of high-yielding lowland rice varieties, the SKY & LAKES LOWLAND RICE PLANTATION PROJECT will also be able to spin out a range of multiple benefits and positive impacts to the local economy, the local farming community, and most significantly make a telling contribution towards land utilization and productivity that will greatly boost food security in the area and generate substantial revenues for Lyantonde District as whole. The project promoter intends to do this project as a large scale lowland rice production enterprise that will be complete with its own on-site rice mill for milling the rice immediately after harvest and make it ready for market sale thus reducing transaction costs and the time lag involved in outsourcing the milling service to outside rice millers. By producing the rice and milling it on-farm, the SKY & LAKES LOWLAND RICE PLANTATION PROJECT will serve as a positive change agent by building a network of paddy producers (out growers) around the rice mill to ensure the regular supply of paddy elevating the status of Lyantonde District in the process into one of the major paddy rice producing districts of Uganda; and developing a vibrant rice value chain within the district that will attract investments for locally-produced rice. The project would thus be able to produce over 600 Metric Tons of paddy rice per season (or 1,200 Metric Tons of paddy rice per annum) using the high-yielding variety of rice seed from the wetland area of 200 acres (80.97 ha) which at a farm gate price of UShs. 1,000/= per kilo would fetch about UShs. 1.2 billion per annum. Assuming that the project induces
16

the uptake of paddy rice production by a paddy producer network producing from an outlying area 10 times the size of this wetland, this would yield an additional 12,000 Metric Tons of paddy rice that would generate a hefty UShs. 12 billion for these small holder rice farmers within the district which would be a substantial income by all accounts for the rural small holder rice farmers in Lyantonde District.

17

8.0

FARM POWER REQUIREMENTS

The provision of adequate farm power is central to increasing rice production to reduce drudgery and ensure timely field operations at the proposed paddy rice production farm. Table 1 shows the necessary farm production and processing equipment that will be stocked and used by the proposed SKY & LAKES LOWLAND RICE PLANTATION PROJECT. Table 1: Farm Production and Processing Equipment for the Rice Production Project EQUIPMENT DESCRIPTION NO. OF UNITS 1. LAND PREPARATION: 1 i. Tractor with implements (Plough, Harrow) 4 ii. Power Tiller (12 HP) with rotavator & accessories 2. PLANTING: 5 iii. Seed Drills 5 iv. Rice Transplanters 3. CROP PROTECTION 20 v. Knapsack Sprayers (16 Ltr Matabi Type) 5 vi. Tractor Mounted Boom Sprayers 4. HARVESTING: 5 vii. Rice Reapers (0.5 tonne/hour) 5 viii. Thresher (0.75 tonne/batch) 2 ix. Combine Harvesters (1 tonne per hour) 5. PROCESSING: 3 x. Parboiler 2 xi. Dryer 2 xii. Energy-Saving Mechanical Dryer 4 xiii. Probe Moisture Tester 1 xiv. Rice Mill 1,000 tonne/year 2 xv. Destoner xvi. Full Automatic Packaging equipment (Bag, sewing and hot sealing machines 2

18

9.0

PROJECT BENEFITS & IMPACT

Benefits of the project

It will improve on food security in Uganda. Creation of employment opportunities in Lyantonde District. Increase Ugandas foreign exchange inflows. Poverty reduction through import substitution. Conservation of scarce foreign exchange is achieved and this is ploughed back into other sectors of Ugandas socio-economic sectors. Attract further investment from local and international investors. Infrastructural development in the district. Opening up of South Western Uganda to even bigger cross border business opportunities through exports of produce. Better standards of living for the local people. Increased revenue to the district. To strengthen the capacity of the District to be able to realize wholesome growth as well as tackle key challenges now and in future that will affect its operations. Reduction in rural-urban migration as more people get engaged in rice farming, input supply and processing of rice within Lyantonde District as a rural district. Life in the rural area of Lyantonde District will become more meaningful as will it will compare with the comforts of large towns and urban cities in Uganda.

All these benefits are in perfect agreement with the VISION 2040 PLAN for national socio-economic transformation. Community Benefits: Sky & Lakes will contribute to the development of physical infrastructure, education and health facilities in Lyantonde District as part of its corporate social responsibility. It shall promote the well-being of the local population by making facilities available to the public within the project locality. Socially, the project shall have a positive impact in the following areas;

Quality of the health facilities. Increase in household incomes. Empowering the local population by bringing services nearer to them. Better infrastructure. Increased urbanization. Improve the quality of education.
19

10.0 1.

EXPECTED IMPACT A viable rice value chain capable of meeting the countrys rice demand put in place. Conservation of foreign exchange earnings resulting from elimination of rice imports. Diversification of the domestic economy. Food security resulting from more than doubling of rice production from 3 MT/ha to 7.14 MT /ha. Generation of additional 5,000 jobs within the rural area of Lyantonde District alone.

2. 3. 4.

20

11.0

SUMMARY PROJECT COSTS

Table 2: Project Farm Infrastructure Costs INVESTMENT COST ITEM Project Farm Building Infrastructure Rice Mill Civil Construction Project Farm Roads Sub-Total Table 3: Project Farm Equipment Costs
EQUIPMENT COST ITEM NO. Of UNITS

COST AMOUNT (UGX) 320,000,000 160,000,000 80,000,000 560,000,000

UNIT PRICE (UG SHS)

TOTAL AMOUNT (UGX)

1. LAND PREPARATION: i. Tractor with implements (Plough, Harrow) ii. Power Tiller (12 HP) with rotavator & accessories 2. PLANTING: iii. Seed Drills iv. Rice Transplanters 3. CROP PROTECTION v. Knapsack Sprayers (16 Ltr Matabi Type) vi. Tractor Mounted Boom Sprayers 4. HARVESTING: vii. Rice Reapers (0.5 tonne/hour) viii. Thresher (0.75 tonne/batch) ix. Combine Harvesters (1 tonne per hour) 5. PROCESSING: x. Parboiler xi. Dryer xii. Energy-Saving Mechanical Dryer xiii. Probe Moisture Tester xiv. Rice Mill 1,000 tonne/year xv. Destoner xvi. Full Automatic Packaging equipment (Bag, sewing and hot sealing machines Sub-Total 1 4 5 5 20 5 5 5 2 3 2 sets 2 4 1 2 sets 2 68 132,000,000 10,000,000 4,000,000 5,300,000 125,000 5,300,000 4,000,000 2,100,000 11,850,000 10,530,000 80,000,000 80,000,000 260,000 105,300,000 7,900,000 21,000,000 132,000,000 40,000,000 20,000,000 26,500,000 2,500,000 26,500,000 20,000,000 10,500,000 23,700,000 31,590,000 160,000,000 160,000,000 1,040,000 105,300,000 15,800,000 42,000,000 817,430,000

21

Table 4: Project Farm Operating Expenses

OPERATING COST CENTRE COST PER ACRE (UGX) TOTAL AMOUNT FOR 200 ACRES (UGX)

Slashing Ploughing (x2) Seeds (25 kgs of required seed per acre @ UGX 1,000/= per kg) Making furrows Planting Harvest Weeding (x2) Milling (UGX 50/= x 3,000 kg/Acre) Packaging (UGX 1,000/= x 30 Polythene bags/Acre) Sub-Total

85,000 200,000 25,000 60,000 40,000 200,000 120,000 150,000 30,000

17,000,000 40,000,000 5,000,000 12,000,000 8,000,000 40,000,000 24,000,000 30,000,000 6,000,000 182,000,000

Table 5: Project Farm Summary Costs PROJECT INVESTMENT ITEM Project Farm Infrastructure Project Farm Equipment Project Farm Operating Expenses Sub-Total

COST AMOUNT (UGX) 560,000,000 817,430,000 182,000,000 1,559,430,000

22

12.0

CONTACTS

Contact Person: Mr. Ambrose Mutafungwa, Executive Director, Sky & Lakes, Plot 59 Martin Road, P.O. Box 828, Kampala. Tel: 0312 284 637/0777 912 297 Fax: 0312 284 637 Email: amutafungwa@yahoo.co.uk Mobile: 0772 444340/0702 344 340

23