Uganda High Court: Contract Farming Bill Regulates Agreements Between Farmers and Buyers

• The Ugandan Opposition is pushing for a new Contract Farming Bill to regulate agreements between farmers and buyers.
• The proposed law aims to reduce crop losses estimated at between 22 and 30% by establishing rules governing contract terms, pricing, provision of inputs, insurance, and dispute resolution.
• The Opposition also proposes a National Post-Harvest Management Policy to address losses occurring after crops are harvested.

These gaps in legislation and policy hold back the full commercialisation of agriculture, weaken risk management, quality control and post-harvest handling, and limit the sector's contribution to household income and food security for the 70% of Ugandans who depend on it.

Uganda's agricultural sector is a significant contributor to the country's economy, accounting for 26.5% of GDP and employing about 70% of the working population. The sector also accounts for approximately 35% of export earnings, making it a vital component of Uganda's economic growth. However, despite its importance, the sector faces several challenges that hinder its full potential, including limited access to affordable agricultural finance, inadequate storage and handling systems, and policy frameworks that have not kept pace with farmers' needs.

The Contract Farming Bill is a critical component of the Opposition's legislative priorities for FY2026/27-FY2030/31. The proposed law aims to regulate agreements between farmers and buyers, establishing rules governing contract terms, pricing, provision of inputs, insurance, and dispute resolution. This move is intended to address the current lack of regulation in contract farming, which leaves farmers exposed to unfair terms and disputes over prices and other contractual obligations.

Post-harvest losses are a major obstacle to agricultural commercialisation in Uganda. According to the World Bank Group report, the country loses between 22 and 30% of its crop harvest after harvest due to inadequate storage and handling systems. The Opposition's proposed National Post-Harvest Management Policy aims to address these losses by establishing regulations covering storage standards, subsidies, and warehouse receipt systems. By reducing post-harvest losses, the policy seeks to improve food security and farmer incomes.

Lawyers and compliance officers should watch for the potential impact of the proposed Contract Farming Bill on agricultural contracts in Uganda, which may lead to changes in contract terms, pricing, and dispute resolution mechanisms.

Source: Original reporting via Opposition Legislative Priorities document