The Ministry of Finance has reported that Uganda’s export earnings fell by Shs 410.4 billion in September 2024, attributing the decline primarily to a drop in coffee exports during the period.
According to the Performance of the Economy Monthly Report for October 2024, which was released on Friday, Uganda’s export earnings decreased by 14.1 percent, from $794.52 million (Shs2.915 trillion) in August 2024 to $682.69 million (Shs2.505 trillion) in September 2024.
The most significant contributor to the drop was a fall in coffee export revenues, which decreased by 34.7 percent. In September 2024, coffee exports brought in $144.71 million (Shs539.9 billion), down from $221.63 million (Shs823.4 billion) in August 2024.
Despite an increase in international coffee prices, Uganda’s coffee export volumes decreased due to “lower coffee yields in the Greater Masaka and South-Western regions of Uganda, following the end of the main harvesting season,” according to the Ministry of Finance report.
This drop in yield led to a reduction in the total volume of coffee exported, which had a direct impact on overall earnings for the month.
The Ministry of Finance highlighted that the coffee sector’s performance is heavily influenced by climatic conditions.
The report emphasized that “the reduced export volumes were primarily due to lower coffee yields” and pointed out that the end of the main coffee harvesting season in Uganda typically leads to lower production levels.
While coffee was the primary factor, the report also noted a decline in earnings from other major export sectors, including mineral products.
The Ministry did not provide specific figures for the mineral export decline but mentioned that lower earnings from these sectors also contributed to the overall export revenue drop in September 2024.
In terms of export destinations, Uganda continued to benefit from a diversified export portfolio.
The Middle East emerged as the largest regional market for Uganda’s exports, accounting for 36.4 percent of total export earnings in September 2024.
Within the Middle East, the United Arab Emirates (UAE) was by far the largest recipient, receiving 97.6 percent of Uganda’s exports to the region.
The East African Community (EAC) and the European Union (EU) were also significant markets for Uganda. Exports to the EAC accounted for 28.6 percent of total exports in September 2024.
Within the EAC, the Democratic Republic of the Congo (DRC) was the largest market, receiving 34.7 percent of Uganda’s regional exports.
Kenya and South Sudan followed closely behind, with 24.8 percent and 18.3 percent of the region’s exports, respectively.
In the EU, Uganda’s exports totaled 18.5 percent of overall earnings for the month. Italy and Germany were the dominant markets in the EU, taking up 47.2 percent and 21.6 percent, respectively, of Uganda’s exports to the region.
The Ministry’s report also highlights the growing diversification of Uganda’s export base, which has helped to offset the impact of fluctuations in coffee earnings.
While coffee remains Uganda’s largest agricultural export, the country has been increasing its exports of non-coffee agricultural goods, minerals, and manufactured products.
These diversification efforts are seen as critical in reducing the risks posed by dependency on a single commodity like coffee.
The Ministry emphasized that “the diversification of Uganda’s export portfolio helps cushion the impact of fluctuations in the coffee market,” which can be volatile due to global supply and demand dynamics.
Looking ahead, the Ministry of Finance stressed the importance of improving the country’s agricultural practices to boost coffee yields and ensure more stable export volumes.
“Strengthening agricultural practices, diversifying markets, and improving yield sustainability will be crucial for Uganda to maintain steady export growth and resilience in its trade sector,” reads the report.
