The year 2017, is basically gone. It has been a 5 year journey in agriculture starting with our first bath of day-old layer chicks on January 3, 2013. Having walked this journey half a decade, this is a chance to look back on the road passed see what lies head
- Paid off capital investment debt, so now all operations are self funded
- Layer production processes strengthened with current flock beating all metrics: time to lay – 17.5 weeks (1 week early), productivity (87%)
- Strengthened logistics support system which is the foundation of our business model – feed production is a completly outsourced service
- Supported the development of a Poultry Farm Calculator developed by Styx Technology Group
- Management processes are key to production all the way from human resource management, records keeping,
- Revenue projections on paper never reflect on the ground reality
- Data is king – we collect, analyse and review operations data on a regular basis, to drive decision making. We have had instances where our thoughts are in one direction, but the data tells a different story. Numbers never lie
- Information is power – over time we have learnt to read detailed documentation, experiences from around the world, and scientific papers to get grounding in the business we are in
- Make business model decisions and stay firm until they are validated – unlike traditional knowledge and advice, we made a strategic to outsource feed mixing as we were ill equipped, did not have the knowledge, and time but invested time in building a strong relationship with our feed supplier. This paid off as we can focus on core skills – production process improvements and increasing sales revenue
- Capital investment has to be strategic – the dream of many poultry farmers is to have high levels of automation such cages, automated drinkers which reduce human intervention, but require 100% more capital.
- Human resource management – this is a make or break area within any enterprise. We use semi-skilled labor, leveraging modern HR management practices for performance management, loyalty building to retain staff.
- Process, process, process – this is the foundation of decision making, and we keep the decisions to a minimum and explain why. Once this is well understood we have only had to tweak and never change a process.
- Expansion into fish farming which as expected was a huge learning curve with inadequate local knowledge, so have to grow own knowledge
- Building a double storied structure – this was a consequence of having limited space with no options for expansion, however the capital would have been best invested in expansion elsewhere.
- Formalize the paper based processed into clear documentation to help other farmers grow and develop
- Leverage partnership with Styx Technology Group to develop an end-to-end Poultry Management System for layers with analytics and business-level metrics
- Expand the farm operations to 10k birds which will provide economies of scale that drive profitability
- Expand into local indeginous chicken breeds with a different business model that suits them
- Vertical integration of dairy, lusuku and indeginous poultry on a single operation location
Some of the key challenges for a lusuku are weed manageent, maintaining the fertility of the soils plus dealing with droughts especially with the unpredictable rains currently being experienced around the country.
Mulching provides a natural and organic measure of combatting all the challenges above but with its own constraint of finding suitable plant material in appreciable quantities to provide an adequate layer. Our drive to focus on staying away from chemical fertilizers and herbicides/pesticides is a further driver for our push to mulching.
What we have done:
- Provided 3 feet separation from the banana stools to the mulch
- Addition of ash (from regular charcoal based cooking) in the space without mulch to control nematodes and other pests
- Cutting off the dried out leaves to provide additional plant material for the mulch
Just before the next rains in March 2017, we shall look to add cattle and goat dung for manure.
Spacing for mulch around stool
Mulch view 1
Mulch view 2
Mulch view 3
Mulch view 4
As part of the expansion of the fish operations, the next phase is to improve the amount of control over the conditions within the ponds. Currently the water is only changed once in 3-4 days depending on the weather conditions.
The plan is:
- Setup RAS circulation with solid settlement and bio-filters (Ultra-violet light based)
- Setup a solar system to power the pumps moving the water
- Add a covering over the tanks to produce a “green-house” like effect to maintain the water temperatures in ranges that are ideal for tilapia
Settlement and bio-filter tanks
Top view of RAS
This is an interesting scenario brought about by Dr. Samuel Sewagudde of Genesis East Africa Ltd in one of a poultry Whatsapp group that highlights the challenges poultry farmers face in their business choices. I will use this scenario to provide step-by-step analysis of how to build the data for decision making.
Speaking of Economics, Catherine usually buys layer feed from Matama Feeds Ltd at UGX 800 sh a kg and her birds lay averagely at 72%. At a recent Farmers Expo she met Augustine who works for Mulegi High Quality Feeds Ltd who convinced her that she would achieve 80% production if she uses Mulegi feeds. Mulegi layer feeds cost UGX 1000 sh per kg. Now if Catherine sells a tray of eggs at UGX 8000, Should Catherine switch and use Mulegi feeds?
In this computation the following assumptions have been made:
- Each bird eats 125g of feed per day
- The costs of the feeds include transportation so no additional costs are incurred with the feed
- There are no additional costs incurred in the sale of the eggs
Using the above information:
- Matama feeds cost UGX 100 per day while Mulegi Feeds cost UGX 125 per day
- At 72% production each bird generates UGX 192 per day (8000 * 0.72 divided by 30) while at 80% production the revenue per bird rises to 213/= (8000 * 0.8 divided by 30).
- The increase in cost of feed is UGX 25/= per bird per day while the increase in revenue is UGX 21/= per bird per day
Therefore changing feed providers means that Catherine will spend an additional UGX 4/= per bird per day, therefore the increase in production does not meet the increased costs of feed.
The moral of the story therefore is increased production does not always translate to increased profitability
Agriculture has long been the mainstay of Uganda’s populace providing livelihoods to over 80% both directly and indirectly. Over the last 2-3 years, agriculture investment and operations has moved to urban employed who are looking at it as an alternate investment. Due to the education system however there is no exposure to farming practices, knowledge and experience.
In comes the popular one day and half day agro-training workshops, seminars and agro-tours to existing farms as part of knowledge sharing, experience and a way of inspiring the “new age” farmers. While this is a good idea proving an accelerated experience, eduction and exposure. The new cash cow is holding training sessions and experience visits for new farmers, however this does not provide next steps for starting new enterprises or improving/scaling up existing ones.
While the commercialisation is difficult to control, there are a few tips that one can use to discern between what is useful and what is not outlined below:
- The training & experiential visits must be on a farm where the learnings can be seen in practice.
- The hosts and facilitators must have been in business for at least 3 seasons of production which provides great learnings.
- Ask questions about the investment and profitability numbers, remembering that this is just a metric for what is possible and your own experience may be different – you may perform better or worse
- Carry out your own research to validate what the benefits from the training session are
- Ask questions of the organisers and hosts to get a feel of how well they know the subject matter
- The best experiences are focused on a single crop/livestock area
The best experiences to date for me have been the Bongole Farm Passion Fruit visit
and Aqua Farm fish learning visit (blog post coming in a week or so as I digest the information).
Remember this is an investment of money and time on your part, so use it wisely.
We are excited to be starting a new chapter at the farm, where we have a new batch of chicks that have come in today, Isa Brown, with the learnings from the last 2.5 years of business.
The changes that we have put in place:
- Increased bio-security with a dry lime bath on entry into the brooder
- Testing a new “sigiri” in addition to the pots
- Using newspapers as a bio-layer over the coffee husks, that will disintegrate and mix with the litter
- Contracting with an experienced poultry brooding services company to provide a dedicated person to raise the birds from day-old to about 6 weeks, depending on the progress and learnings that we have had.
Brooder – Day old chicks – View 1
Brooder – Day old chicks – View 2
Brooder – Day old chicks – View 3
There are a lot of interesting articles on the web on different farming models for Africa, many of which acknowledge that large scale farming is not possible. However the prescription is social enterprise driven engagement with small holder farmers, such as this New Model farming (http://africanbusinessmagazine.com/special-reports/new-model-farming/) and Realizing the potential for high returns from agriculture (https://agenda.weforum.org/2015/07/realizing-the-potential-for-high-returns-from-agriculture/)
However this new thinking is still flawed because there is no understanding of the thinking of small holder farmers which is grow enough to survive with a little left over to meet basic needs around the household. This does not lead to a focus on agronomical practices that increase yields, or in investments for growth past the current season, or even pursuit of higher revenues for better markets.
I have argued in a previous posts on the mindset shift required for agriculture to succeed in 2015 and beyond https://ugfarmer.wordpress.com/2015/02/26/mindset-shift-required-agriculture-success-for-2015-beyond/ and so has this author Agriculture in Uganda Where Next (http://ssmusoke.com/2014/10/08/agriculture-in-uganda-where-next/)
In summary the model is neither small holder farmers nor commercial farming, but rather a usually ignored hybrid of the two which is mid-tier family owned farming enterprises run by urban trained professionals.
Why would this be successful:
- Farms are run as agribusinesses, with cost and revenue models focusing on not only short term profits and longer term growth
- The mindset changes allowing the use of professionals such as veterinary doctors, agronomists, crop specialists to maximize the productivity of available land
- Increased use of agro-inputs such as improved seeds, agronomical practices such as irrigation, greenhouse farming, fertilizers, as well as pesticides/herbicides/fungicides to control pests and diseases.
- Access to capital and financing to smoothen out slumps
- Focus on revenues, leading to improved marketing, and distribution models.
- Ability to combine resources with others in cooperatives and farmers group to increase purchasing power, advocacy to drive government policy towards policy improvement.
- Mindset and appetite for growing economies of scale to improve revenues
- Mindset to embrace value addition to increase and stabilize revenues across peak and off-peak seasons
So in order to drive Africa forward the need is to grow the “middle class” agribusinesses which have the potential to feed the world.
What are your thoughts?