Regional supply elasticities in Uganda's cotton industry and the disappearing cotton bales

The "Double Production" campaign in Uganda's cotton sector is a well known slogan in the Second Republic. Actual production however is declining instead. In this paper, we use time series acreage and price data disaggregated on a regional basis to estimate regional supply elasticities. We use the estimated regional differentials in supply responsiveness to explain why total output will decline especially in Buganda in the absence of a well designed pricing policy and in the light of a high demand for food crops in the current Ugandan environment of a disintegrating internal transportation system. We argue and prove empirically that the skyrocketing food prices in the urbanized central Uganda have effectively reversed the cash earning roles of cotton (a traditional cash crop) and those crops traditionally known as subsistence crops. This phenomenon has been reinforced by the well known producer price depressing effect of the Lint Marketing Board pricing policy as well as the breakdown of the commodity distribution system that has isolated the towns from the food producing rural areas in today's Uganda.