By James Mutegi, Freddie Kalibwani, Sara Lamsili, Bernice Limo, Brian Valencia, Salah Eddine Lahmadi, Derrick Komwangi, Claire Rhodes, and Thomas Oberthür
The Uganda Carbon Coffee Project (UCCP) tackles challenges in Uganda’s coffee sector through carbon finance, agroforestry, and sustainable practices. Currently engaging over 3,000 farmers, it enhances resilience, diversifies incomes, and promotes environmental sustainability.
Uganda, an East African country with high potential for productivity, is grappling with multiple challenges of land degradation, livelihood improvement, and climate change. Stakeholders agree about the role of sustainable interventions in controlling and reversing escalation of the effects of these challenges. Coffee production is estimated to cover approximately 353,000 ha of the country’s 6.9 million (M) ha of arable land. It contributes to greater than 15% of Uganda’s export income (World Coffee Research, 2021) and is the main income source for a significant number of Ugandan families. The country’s coffee production has grown significantly, from 94,000 tons in 1961 to 394,000 tons in 2022, reflecting over a four-fold increase in six decades (FAO).
Globally, the country ranked 5th in green coffee exports in 2022. The number of coffee farms totals over 1.7 M. The coffee industry in Uganda faces significant challenges but also holds immense potential for growth. Current yields average just 0.5 t ha-1, far below leading producers like Vietnam, which achieved 2.9 t ha-1 in 2022. This gap highlights a major opportunity for Uganda to increase productivity. There are a multitude of reasons behind this low productivity, one of them is land degradation, and perhaps even more critical are age of trees, access to knowledge and inputs, etc. By addressing issues such as land degradation, and adopting sustainable farming practices, the country can enhance both the quality and quantity of its coffee production, ensuring greater sustainability and resilience for the industry.
Such low yields generate low incomes for farmers. Markets providing payments for environmental services (see Forest Trends Ecosystem Marketplace, 2023) activate an opportunity for agro-forestry systems to generate much-needed additional income (e.g., Nath et al. 2023) while the corresponding management changes can strengthen system resilience (Mokondoko et al. 2024). Furthermore, systematically enabling the provision of environmental services by agroforestry systems integrates economic, social and ecological dimensions of sustainability and resilience as a prerequisite to transformation of farming systems (Poncet et al. 2024).
As such, a recently established project titled “Uplifting Income and Climate Resilience in Biodiverse Ugandan Smallholder Coffee Systems” or “Uganda Carbon Coffee Project (UCCP)” is addressing these challenges through improved system resilience and agronomy, ecosystem restoration, income diversification, and market access. At the heart of the UCCP lies the activation of carbon (C) finance within an improved coffee landscape management system. The resulting additional income is envisioned to strengthen the productive capacity of the coffee systems. The project brings together the Ankole Coffee Producers Cooperative Union (ACPCU) which primarily produce organically certified coffee, the Environmental Conservation Trust of Uganda (ECOTRUST), NGO Producers Direct, OCPFoundation, Makerere University, and the African Plant Nutrition Institute (APNI), an African leader in soil health and crop nutrition.
Structure of the implementation
This initiative, initially targeting over 3,000 smallholder farmers from the ACPCU in southwest Uganda, is structured around four components: (i) planting over 900,000 trees and implementing agroforestry practices to mitigate climate change impacts, (ii) building farmer capacity to adopt diversified coffee system practices, including apiculture and horticultural crops, (iii) improving coffee farm incomes through digital marketing of diversified products integrated into the coffee system (e.g., apiculture-honey, fruit trees-fruits, vegetables and legume), and (iv) enhancing C sequestration measurement and credit calculation by incorporating research on belowground C inputs, thereby enabling future C market integration. Presently most C payments find it risky to integrate belowground C into payment schemes due to a paucity of belowground C data.
Activating carbon finance for improved management of coffee systems
UCCP aims to foster sustainable improvement and diversification of coffee systems through C finance. Coffee farmers are recruited, trained and provided with tree seedlings to plant on agreed parts of the farms. Farms planted with trees as part of this initiative are then monitored and assessed to quantify and certify sequestered C. This process enables them to access C credits (payments).
Ultimately, this agroforestry initiative will enhance soil health, reduce greenhouse gas accumulation in the atmosphere through CO2 capture, and diversify farmers’ incomes. ECOTRUST facilitates access to C credits using the Plan Vivo (https://www.planvivo.org) methodologies. Plan Vivo is an independent crediting program for forestry, agricultural, and other land-use projects with a focus on promoting sustainable development and improving rural livelihoods and ecosystem services. Plan Vivo projects work closely with rural smallholders and communities, and the standard emphasizes participatory designs, ongoing stakeholder consultation, the use of native species, and biodiversity enhancement within a variety of payment for ecosystem service schemes including avoided emissions and enhanced removals. The Plan Vivo Foundation certifies and issues forward crediting (‘ex-ante’), and post-sequestration (‘ex-post’) C credits called ‘Plan Vivo Certificates’.
As such, significant strides have been made in ensuring timely payments to farmers participating in the C payment scheme. A total of 277 farmers received their C payments, which were distributed directly on-site or via bank accounts. For a three-month period, the total amount of carbon market funds distributed via ECOTRUST to farmers participating in the scheme amounted to UGX 81,474,363 (approximately 22,160 US dollars).
Additionally, the seedling suppliers, an integral part of this environmental initiative, were compensated through the project for their role in supporting tree planting in the region. The total payment to seedling suppliers during this same three-month period amounted to UGX 16,629,500 (approximately 4,535 USD). This payment reinforces the commitment to sustaining tree-growing activities and the broader ecological goals of the project.
Theory and practice on C finance process for farmers
As the project progresses, it aims to assess the impact of improved agronomy on the whole coffee production landscape including soil C sequestration potential.
This analysis is critical to understanding how C finance can support sustainable agriculture at the farmer level, enhancing both land productivity and income potential through environmental services. Using a foundation of agroforestry, the project introduces targeted interventions that improve soil health and C capture across different agroecological zones. The methodology includes detailed ecosystem profiling—through satellite imagery, field data, and community input—which informs tree species selection and planting techniques best suited for C retention in each area. These species, carefully chosen to complement local crop patterns, will foster soil fertility, water retention, and biodiversity, all of which are vital for increasing soil C content.
This C-focused approach also underscores the development of performance-based C contracts for enrolled households, structured to incentivize sustainable practices while generating income. Each participating farmer commits a portion of their land to agroforestry and adheres to a tailored land-use plan, ultimately receiving compensation for measured C sequestration outcomes. This agreement, aligned with community input through Free, Prior and Informed Consent (FPIC) processes, establishes a clear understanding of responsibilities and benefits. Annual monitoring of tree growth, survival rates, and C capture informs C payments and tracks environmental outcomes. Through tools like Farmer Voice Radio and community feedback mechanisms, farmers will also share their experiences and gain technical insights, enabling a bottom-up approach to carbon finance that ensures carbon gains align with sustainable agronomic practices and real household benefits.
Role of C finance on long-term system resilience and sustainability
Carbon finance will play a transformative, long-term role in improving the coffee production system. Since the inception of this project, the main objective has been to create diversified income opportunities for farmers over and above incomes from the coffee bean. Emphasis is put on the re-investment of funds from C credits and other diversified income sources promoted by the project into the coffee agronomy and inputs to boost productivity and quality. Beyond C finance, on-farm tree establishment offers substantial multiple additional benefits through environmental conservation, C sequestration, and soil health management. Each of these is critical for ecosystem resilience and long-term system sustainability. Additionally, the C payments are distributed over a 25-year period. This will provide a long-term income source, extending the project benefit for nearly two decades beyond the 4-year project cycle.
In conclusion, the UCCP mobilizes smallholder farmers, leverages innovative technologies, and fosters collaboration to address smallholders’ need for climate change adaptation and economic development in Uganda’s coffee sector. By empowering farmers, enhancing environmental sustainability, and fostering partnerships, the project catalyzes positive change while serving as a model for sustainable agriculture globally.
Acknowledgment
This project is funded by APNI and OCP Foundation and implemented in partnership with the Ankole Coffee Producers Cooperative Union (ACPCU), Mohammed VI Polytechnic University (UM6P), Environmental Conservation of Trust of Uganda, ECOTRUST, Makerere University, Producers Direct, and OCP Foundation.
Dr. Mutegi (e-mail: j.mutegi@apni.net) is Senior Scientist, African Plant Nutrition Institute (APNI), Nairobi, Kenya. Mr. Kalibwani is Head of Business Development, Environmental Conservation Trust of Uganda (ECOTRUST), Kampala, Uganda. Ms. Lamsili is Junior Project Communications Manager, APNI, Benguérir, Morocco. Ms. Limo is Research Assistant, APNI, Nairobi, Kenya. Mr. Valencia is Consulting GIS & Data Analyst, APNI, Cali, Colombia. Mr. Lahmadi is International Program Lead, OCP Foundation, Rabat, Morocco. Mr. Komwangi is Projects Manager, Ankole Coffee Producers Cooperative Union (ACPCU), Kabwohe, Uganda. Ms. Rhodes is CEO, Producers Direct, London, UK. Dr. Oberthür is Director of Business & Partnerships, APNI, Benguérir, Morocco.
Cite this article
Mutegi, J., Kalibwani, F., Lamsili, S., Limo, B., Valencia, B., Lahmadi, S.E., Komwangi, D., Rhodes, C., Oberthür, T. 2024. Harnessing Carbon Finance to Elevate Uganda’s Coffee Sector. Growing Africa, 3(2), 2-5 https://doi.org/10.55693/ga32.WVND9043
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