Cotton was introduced in Uganda by the British Cotton Growers’ Association in 1903 under the then British Colonial Government as the first cash crop. While production was carried out in Uganda by small scale farmers, ginning was done in Kenya and the lint was then exported to Liverpool to service the British Textile Mills. The crop was initially grown only in the Central Region but eventually it spread to the rest of the Country. Between 1903 and 1930, it was grown purely as a Government crop whereby each family had to mandatorily have at least 0.5 Ha as a way of generating household incomes. Production rose steadily to 44,000 bales in 1920.
In the 1920s, Coffee was introduced in the country, followed by Tea and Tobacco. Eventually, coffee overtook cotton in the 1930s as the country’s major foreign exchange earner and cotton took second place.
During the same period, the Private Sector, mainly of Indian origin, established ginneries across the country and took over Processing and Marketing while Government retained the Research, Seed Breeding, Extension Services, Input Supply and Quality Control functions. In addition to these functions, Government established 3 textile mills and 1 spinning mill in the late 1950s to add value to lint and to absorb the increasing production.
All these arrangements worked well and production increased to 371,000 bales by 1960/61. Thereafter, the population revolted against the private sector due to exploitation and as a result, farmer co-operatives emerged around 1962 when Uganda became independent. Subsequently, Government compensated the private sector, took over ownership of the ginneries totalling about 50 and handed them over to the Co-operative Unions.
The Co-operatives performed very well in the beginning because there was transparency and accountability, and inputs and crop finance were delivered through them. Government set up a Lint Marketing Board (LMB) with monopoly to trade in all the lint and cotton seed. It also retained all the other functions mentioned above. As a result, production shot up reaching the highest level ever produced in Uganda of 470,000 bales of lint in 1969/70.
During the early 1970’s to mid 1980s, civil strife, economic turmoil and poor governance befell Uganda and all activities of the cotton sector were severely affected. Cotton being an annual crop could not survive. As a result, production fell drastically reaching the lowest level of 11,000 bales in 1987/88. Uganda Cotton ceased to be traded by grade on the International market and was instead traded by source ginnery of the lint.