VERMI-CULTURE BUSINESS IN UGANDA
Introduction
Vermiculture: “The raising and production of earthworms and worm castings” In recent years, thanks to the growing awareness, the benefits of organic compost have been understood, and today, more and more farmers want organic compost as it enhances the soil fertility and regenerates micro organisms in the soil.
This idea is associated with risks of harmful organic waste to the soil, however, this can be mitigated by applying Vermi-culturing technology. Project cost is US$ 7,640, revenue is estimated at US$29,063 from production of 360 kgs of worms, which are used as baits in the fishing sector, cocoons and residues annually. The net profit margin is estimated at 3% with a payback period of 3 years.
Production Process, Capacity and Technology
Much similar to the process of making vermi-compost, this involves breeding of earthworms in a mixture of cow dung and agricultural wastes to make organic compost manure. The profiled project has a minimum capacity of 30kg per month and this, among others is on the basis of 26 working days in a month and single 8-hour work shifts in each working day.
Capital Investment Requirement in US $
| Item | Units | Qty | Price | Total |
| Compost turning equipment | No | 1 | 1,200 | 1,200 |
| Screening equipment | No | 1 | 1,700 | 1,700 |
| Green waste picking station | No | 2 | 870 | 1,740 |
| Sieves of 3mm | No | 2 | 1,500 | 3,000 |
| TC of tools | 7,640 |
Production and Operation costs in US$ Direct materials, supplies and costs
| Cost Item | Units | @ | Qty/ day | Pdn cost/day | Pdn cost/ month | Pdn cost/ year |
| Direct Costs | ||||||
| Cow dung | kgs | 0.2 | 12.8 | 2.56 | 66.664 | 799.96 |
| Earth worms | kgs | 8.2 | 0.16 | 1.312 | 34.112 | 409.34 |
| Agricultural residue. | kgs | 0.07 | 5 | 0.35 | 9.1 | 109.2 |
| Sub-total | 4.23 | 110 | 1319 |
General Costs (Overheads)
| Labour | 1,650 | 19,800 |
|---|---|---|
| Selling & distribution | 100 | 1,200 |
| Utilities (Water, power) | 200 | 2,400 |
| Rent | 25 | 300 |
| Miscellaneous expenses | 100 | 1,200 |
| Depreciation | 159 | 1,910 |
| Sub-total | 2,234 | 26,810 |
| Total Operating Costs | 2,344 | 28,129 |
- Production costs assumed are for 312 days per year with daily capacity of 1.15 kgs
- Depreciation (fixed asset write off) assumes 4 year life of assets written off at 25% per year for all assets.
- Direct costs include: materials, supplies and all other costs incurred to produce the product.
- A production month is 26 work days
- Currency used is US Dollars.
Project product costs and Price Structure
| Item | Qty/day | Qty/ year | Unit Cost | Pdn cost/ yr | UPx | TR |
| Worms | 1.15 | 359 | 78 | 28,129 | 81 | 29,063 |
Profitability Analysis in US$ Market
| Profitability Item | Per day | Per month | Per year |
|---|---|---|---|
| Revenue | 94 | 2,422 | 29,063 |
| Less: Production and operating costs | 90 | 2,344 | 28,129 |
| Profit | 3 | 78 | 934 |
Thanks to the awareness in rural areas, the demand for Vermicompost is growing supported by an increase in the number of commercial establishments especially in market gardening and flower farmers.
Suppliers of Equipment and Materials
All the equipment needed for this project is available in Uganda and at a cheap price. Tonet Ltd, Kanyanya, Gayaza. Worms can be got from Kawanda or Namulonge research centers.