Profit Margins on Cassava Production

Profit Margins on Cassava Production

Cassava is the basic food for over 600 million people in the world and produced by 105 countries. Nigeria is the leading producer of cassava in the world, producing 35million metric tons while Uganda produces approximately 5 million metric tons per year. In Uganda, cassava is the second most important staple food crop, after bananas in terms of production and consumption. The traditional growing areas of cassava are West Nile, North, and Eastern parts of the country. Today, it is increasingly becoming an important crop in the south and western areas of the country.

The crop is mainly grown by smallholder farmers (on 1-2 acres of land) for food security and income generation. Most of it sold as dry cassava chips or cassava flour milled from the dried chips but gradually more and particularly in urban areas as fresh cassava roots.

There have been efforts by the government of Uganda for large scale production for the ever-increasing commercial uses of cassava in the baking industry, industrial use in the manufacture of paper board and starch, alcohol, biofuel, pharmaceutical industries.

The yield from an acre of cassava ranges 4-8 MT, which translates into 1.5-4 metric tons of dried cassava chips and 1.2 -2.5 metric tons of cassava flour.

Cassava Production
Gross Margins per acre
Input Name Local NASE 13 NASE 14
Cassava cuttings (bags) 50,200 56,000 60,000
Transport 15,000 15,500 15,900
Land preparation (man days) 81,500 81,500 81,500
Ploughing (man days) 110,700 110,700 110,700
Planting (man days) 117,000 117,000 117,000
Weeding (man days) 133,000 133,000 133,000
Harvesting (man days) 179,000 190,500 190,500
Packaging (bags) 20,000 23,000 25,000
Total Variable costs (Ug shs/acre) 706,400 727,200 733,600
Unit price 30,000 30,000 30,000
Quantity sold (bags per acre) 28 32 35
Total Revenue (Ug shs/acre) 840,000 960,000 1,050,000
Gross margins (Ug shs/acre) 133,600 232.800 316,400
Gross margins (Ug shs/bag) 4,771 7,275 9,040
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